Seeking Alpha

3D Systems dives following new Citron attack, peers also off

  • In a new report, Citron Research assigns a $56 near-term PT to 3D Systems (DDD -6.5%), and takes aim at the company's valuation (naturally), growth prospects, and competitive positioning.
  • Citron doesn't believe any of the companies 3D has acquired "control transformative technologies" amid a fragmented IP environment for 3D printing, and deems its Cube consumer/enthusiast 3D printer line to be second-rate.
  • As evidence, it notes a Cube printer has an average rating of just 2.6/5 on Amazon from 10 reviewers, while MakerBot's (SSYS -4.7%) competing Replicator 2 has a rating of 3.8/5 from 48 reviewers.
  • Citron also notes recently-acquired Phenix Systems (represents 3D's entry into the metal printing market) has had less than $10M in revenue each of the last four years, and makes note of pending competition from Mitsubishi, H-P, and Epson. Likewise, The Sugar Lab (acquired in September) is deemed to be "nothing more than a husband and wife team working out an apartment in East Los Angeles."
  • Like Credit Suisse, Citron notes 3D trades at a major premium to Stratasys, which it considers a relatively better investment, and thinks shares would only be worth $46 even if 3D generated $2B in 2021 sales with a 20% profit margin, and paid no taxes.
  • Stratasys has followed 3D lower, as have Voxeljet (VJET -5.8%) and ExOne (XONE -6.8%).
  • Previous: Citron calls 3D a "bubble stock"
Comments (32)
  • Esekla
    , contributor
    Comments (2032) | Send Message
     
    Yep, just commented on it, and while I agree in general, the two loopholes in Citron's reasoning are materials expertise and service centers. One company is showing the proper focusing in just those areas:

     

    http://bit.ly/M4knJW
    24 Jan, 12:01 PM Reply Like
  • ptolchin
    , contributor
    Comments (11) | Send Message
     
    3D Systems should turn to SGLB (Sigma Labs). They have software for 3D printer in-process quality assurance. GE Aviation uses them. Their software works for any type of metal 3D printer.
    24 Jan, 12:25 PM Reply Like
  • brh207
    , contributor
    Comments (4) | Send Message
     
    Mr. Left is a short seller. It's in his best interest to downgrade the stock, so I think this opinion is subjective to his own goals. I would just keep that in mind when and if considering this piece of journalism.
    24 Jan, 12:30 PM Reply Like
  • J Mintzmyer
    , contributor
    Comments (3549) | Send Message
     
    Citron is one of the best-- if their track record keeps up for another 4-5 years, they'll be among the best of all time.
    24 Jan, 12:34 PM Reply Like
  • Mongoose7916
    , contributor
    Comments (199) | Send Message
     
    You're kidding right?
    24 Jan, 12:47 PM Reply Like
  • just read the instructions
    , contributor
    Comments (102) | Send Message
     
    There is nothing glorious about a company specialized in colorful yellow-press style sh#tstorms It is a asymmetric situation as the company can not defend itself.
    I have no shares in DDD but I feel a bit obliges to put my 50 cent in.

     

    - It is quite natural that there is a facebook group of "(insert name here) likes" for anything new/fancy/hyped. I guess that there is a big "(iPhone) sucks", (Windows8) sucks" group as well.

     

    -Wohlers is an industry consultant, not a young nerd. You would have got the same answer from an mid-aged guy back in the early 80th about the PC-hoppyist, or from someone at aT&T about mobile telephones.

     

    - $DDD is a consumer oriented 3D printer company. It makes sense to leverage their market position and customer/media awareness to get into industrial applications as well. There is nothing wrong about it, esp. if the aquisition was cheap. Sometimes market position wins over superior technology.
    24 Jan, 01:57 PM Reply Like
  • ECapo
    , contributor
    Comments (414) | Send Message
     
    J Mintzmyer...I have no where near the comments you have made of 3245 on SA, but would you please show us the basis for your comment Citron is one of the Best with comparisons of the Best..
    24 Jan, 02:08 PM Reply Like
  • Early Morning Packer
    , contributor
    Comments (22) | Send Message
     
    The best what?
    24 Jan, 03:01 PM Reply Like
  • ECapo
    , contributor
    Comments (414) | Send Message
     
    Ask J Mintzmeyer who commented above....he stated he has the information to support that I believe....
    24 Jan, 04:27 PM Reply Like
  • interzone826
    , contributor
    Comments (182) | Send Message
     
    Who is "Mr. Left"? There is no mention of that name in the text above.
    25 Jan, 12:49 AM Reply Like
  • shawn86
    , contributor
    Comments (3) | Send Message
     
    The reason Citron's research tend to turn out to be "correct" is that Mr.Left is playing with trader's fear, which is much more easily manipulated than greed.

     

    What Mr.Left do is simple:
    -Release report that catalyze people's fear. More effective if the market is already filled with fear. Like last Friday when all major indices were down about 2%.
    -Stock reported on must be highly volatile. Large traded volume and less institutional ownership. Newer the industry and the company, the better.
    -Short sell the stock and oversupply the market. Due to increase in supply and decrease in demand, the stock price will fall. This price fall further "confirms" his report is "correct." Panicked stock holder sell even harder, drive the market lower.
    -This cycle continues until no more easily manipulated sellers are left. The stock price will enter correction period and Mr.Left and his little friends happily take the profit.

     

    If you research chart pattern before and after Citron's reports are released. You will see this clearly and will be surprised how market can be easily manipulated.

     

    If you're day or swing trader, like myself, you can make a huge profit using impact Mr.Left has brought to the market. If you're position trader, sorry, you just have to pray that Mr.Left won't publish a "report" on your stock.
    28 Jan, 01:23 AM Reply Like
  • shawn86
    , contributor
    Comments (3) | Send Message
     
    The reason Citron's research tend to turn out to be "correct" is that Mr.Left is playing with trader's fear, which is much more easily manipulated than greed.

     

    What Mr.Left do is simple:
    -Release report that catalyze people's fear. More effective if the market is already filled with fear. Like last Friday when all major indices were down about 2%.
    -Stock reported on must be highly volatile. Large traded volume and less institutional ownership. Newer the industry and the company, the better.
    -Short sell the stock and oversupply the market. Due to increase in supply and decrease in demand, the stock price will fall. This price fall further "confirms" his report is "correct." Panicked stock holder sell even harder, drive the market lower.
    -This cycle continues until no more easily manipulated sellers are left. The stock price will enter correction period and Mr.Left and his little friends happily take the profit.

     

    If you research chart pattern before and after Citron's reports are released. You will see this clearly and will be surprised how market can be easily manipulated.

     

    If you're day or swing trader, like myself, you can make a huge profit using impact Mr.Left have brought to the market. If you're position trader, sorry, you just have to pray that Mr.Left won't publish a "report" on your stock.
    28 Jan, 03:51 AM Reply Like
  • ECapo
    , contributor
    Comments (414) | Send Message
     
    shawn86...thank you for your simple summary here...I hope anyone interested in Citron and Mr. Andrew Left read it!!! As I hope investors in 3 D read it too. Not too many posts by people who short and long are such forthcoming...I appreciate you honesty and disclosing your types of trading!
    Citron and Mr. Left, here is some information supplied by others in posts that may be helpful to those that have not seen other posts on Citron and Mr. Left and also help them decide.
    Mr. Andrew Left:
    http://bit.ly/MpCol1
    J Michael McKay also had an interesting post below! As to save anyone from looking down, I will paste it here...
    SA needs to question itself as it publishes NEWS and articles from a Citron on down days in progress. The last three times Citron has been listed as calling out and influencing a stock, prices were already falling, much as they were on Friday due to emerging markets news.
    I have really started to question if News is really manipulation.
    My understanding is that articles are published based on editing and may take time, while news apparently can be used to beat the system.
    I have my doubts about both players after so many successful moves which declare Citron as the cause for these falls. I do not deny they don't add to the fleeing herd, I just think they are allowed to take credit for something broken here.
    Great comments from both!
    28 Jan, 11:08 AM Reply Like
  • Bradley Sugarman
    , contributor
    Comments (33) | Send Message
     
    It's always a buying opportunity when Citron puts out their negative reports against DDD. I got in around $29 last year with a similar report. They did another one 6 month ago and the stock did it's traditional dip, fully recover, break new highs.

     

    This is a good buying opportunity for anyone interested in getting in. DDD won't get down to $56 - I'm surprised it's dipped below the $80s (where I sold to rebalance).
    24 Jan, 12:34 PM Reply Like
  • shawn86
    , contributor
    Comments (3) | Send Message
     
    I'm a day/swing trader and I go both short and long when Citron release a report like this. It's surprising how easy it is to make money in a highly volatile, yet predictable market (28% percent profit since last Friday).
    28 Jan, 01:23 AM Reply Like
  • Deja Vu
    , contributor
    Comments (1095) | Send Message
     
    SA editor - the link to the citron report is broken. Thanks!!
    24 Jan, 01:02 PM Reply Like
  • SA Editor Eric Jhonsa
    , contributor
    Comments (738) | Send Message
     
    Thanks for the heads-up. I copied/pasted a link to the PDF, but for some reason, it doesn't load when clicked. For now, I've changed it to a link to Citron's blog post on 3D Systems (includes a link to the PDF).
    24 Jan, 01:06 PM Reply Like
  • bernard_k50
    , contributor
    Comments (160) | Send Message
     
    It is beyond my understanding why you, being a SA editor, can alow a FRAUD to post on SA.

     

    I refere to EL Capo's comment, (the one that got 12 likes).

     

    No heads up from me.
    25 Jan, 07:28 PM Reply Like
  • kvarbus
    , contributor
    Comments (5) | Send Message
     
    Visit Citron Research archive and you'll find out that majority of their shorts are wrong. they're probably shorting DDD that why its "bubble". Pathetic Goldman Sachs wannabes.
    24 Jan, 01:07 PM Reply Like
  • ECapo
    , contributor
    Comments (414) | Send Message
     
    Citron...are you kidding me..Citron by Andrew Left....AndrewLeft is an aggressive short seller..this information is not objective! I am lost as to why SA would make an assumption that 3 D is diving on his articles....it could because 3 D in general has had huge run up recently...or the sector as a whole...with profit taking? or the market as a whole dropping?...
    I have found these links as useful when I hear the name Citron or Andrew Left. You also may want to know more about Andrew Left and here are a few things you need to know...

     

    taken from a former SA post: Bill Matterson

     

    1. Are you the AndrewLeft who lost his futures trading license after the Futures Trading Association judged him guilty (after a hearing) of having defrauded numerous customers?
    2. Are you the same Andrew Left who was a defendant in a class action lawsuit for having defrauded customers of a stock brokerage house?
    3. Are you the same Andrew Left who obtained a license and sold stocks under the false name of Henry Lipton?
    4. Are you the same Andrew Left who filed a fraudulent biography with the SEC in a filing by Detour Online that omitted any mention of the work history described above?
    5. Are you the same Andrew Left who was forced to resign his position at Detour Online?
    6. Are you the same Andrew Left who was accused by Detour Online of stealing $25,000 from the corporate coffers?
    messages.finance.yahoo...

     

    http://bit.ly/MpCol1

     

    "Andrew Left of Citron Research convicted of fraud and barred from association with the National Futures Association
    ANDREW LEFT -

     

    THE PANEL FOUND THAT LEFT MADE FALSE AND MISLEADING STATEMENTS TO CHEAT, DEFRAUD OR DECEIVE A CUSTOMER IN VIOLATION OF NFA COMPLIANCE RULES 2-2(a) AND 2-29(a)(1). LEFT'S CONDUCT WAS INCONSISTENT WITH JUST AND EQUITABLE PRINCIPLES OF TRADE.

     

    CONSEQUENTLY, THE PANEL BARRED LEFT FROM ASSOCIATION WITH AND FROM ACTING AS A PRINCIPAL OF ANY NFA MEMBER FOR THREE YEARS; ORDERED HIM TO TAKE AN ETHICS TRAINING COURSE; AND PLACED RESTRICTIONS ON HIS ACTIVITIES FOR TWO YEARS WHICH PREVENT HIM FROM SUPERVISING ANY AP AND REQUIRE HIM TO TAPE RECORD AND LOG ALL CONVERSATIONS WITH CURRENT AND POTENTIAL CUSTOMERS. "

     

    you decide for yourself
    24 Jan, 01:32 PM Reply Like
  • Weighing Machine
    , contributor
    Comments (556) | Send Message
     
    Are you the same Andrew Left who has pointed out 50+ frauds which went to 0? I'm pretty sure that's all that matters
    24 Jan, 02:06 PM Reply Like
  • bernard_k50
    , contributor
    Comments (160) | Send Message
     
    Should SA not ban any more "contributions" from this FRAUD? Isn't that the task of an editor? In stead of copying and pasting his lies?
    24 Jan, 02:03 PM Reply Like
  • BuyToSell
    , contributor
    Comments (215) | Send Message
     
    I'm always surprised when people take these Citron reports seriously enough to actually sell their stocks. Oh well, I guess there's one born every minute.
    24 Jan, 02:44 PM Reply Like
  • ECapo
    , contributor
    Comments (414) | Send Message
     
    BuyToSell..Do not forget...shorts write these articles to get more people to go short the stock....and help them make money shorting...until a short cover occurs and then they buy to cover some of their losses..they are more day traders....and day to day gamblers of our market and not Investors as some may be..
    and to
    bernard_k50 I am awaiting the response to your comment...I do not know why SA authors would write an article as above....and do I think SA should write a short position article as above....you decide...
    or maybe the author of this SA article who sent it to 38,448 people ..would care to respond? You may direct a comment to him...it is allowed...he is I believe:
    SA Editor Eric Jhonsa

     

    personally I prefer more factual unbiased articles...like his previous one:

     

    Chinese tech stocks tumble on SEC action; new Qihoo/Alibaba rumor emerges
    and
    2013 Xbox One sales topped 3M
    and on unbiased annalist who write than a person of Citron as above!
    24 Jan, 03:32 PM Reply Like
  • nonyanj1969
    , contributor
    Comments (2) | Send Message
     
    I guess this guy never heard of Steve Jobs, who started apple, working out of his garage. I guess Hershey, Google and Intel are working with 3D systems because it's a fraud.. This character from Citron sounds like he's heavily shorted and taking advantage of a few day sell off to scare the longs.
    24 Jan, 03:02 PM Reply Like
  • OkieKid1868
    , contributor
    Comments (3) | Send Message
     
    Should a short seller be able to comment on a stock that he is currently shorting...especially when he is known for negatively impacting stocks for the benefit of himself? He appears to have the wolf pack mentality of jumping on the pile when others are commenting negatively about a stock in what appears only to drive the price down.

     

    I honestly, believe when you look at 3-D systems and make a comparison to say Apple...3-D systems is innovative and smart when it comes to devolpement. Why spend time and money to innovate a part for a system when it already exist. Simply buy it out and add it to your system...Apple does the same thing! Money...they have money...asset to debit ratio is excellent. Hi tech companies PE ratio's are notoriously high...especially when they are growing the business such as 3-D system with its acquisitions this year.

     

    Citron is a new breed out to destroy companies for the short! For 3-D systems luckily he was wrong last time.

     

    For the record I do not own any 3-D system stock...I just believe that the company is going to be one of the big leaders in changing the world with 3-D printing.
    24 Jan, 04:56 PM Reply Like
  • DDDEWWW
    , contributor
    Comments (4) | Send Message
     
    so you believe the price of a stock is gonna go up, and you chose not to invest your money in it? why not scoop up some cash if you think there is no risk?
    26 Jan, 09:06 AM Reply Like
  • Jeb Walport
    , contributor
    Comments (213) | Send Message
     
    This just in: "Citron issues negative PT on SNAFU".
    24 Jan, 07:52 PM Reply Like
  • chris293
    , contributor
    Comments (174) | Send Message
     
    The bears are attacking! Everyone makes money, which is good except for the sellers unless they have a real loser of a stock. Loose lips, the ones overstating their concerns for your stocks may have their own profit motives and love to tell you their opinions. If you have done your homework on your stocks, then what do you have to worry about? The stock can either go way down or way up; but, that's usually a game for the options players. And remember, advice is worth what you pay for it.
    25 Jan, 10:45 PM Reply Like
  • knifeman98
    , contributor
    Comment (1) | Send Message
     
    Citron....Andrew Left......Unbelievable that anyone would pay attention to this short selling IMO off base nut
    26 Jan, 08:52 AM Reply Like
  • refik
    , contributor
    Comments (4) | Send Message
     
    Andrew Left. Has just left the room.. Let's see what happens to DDD on Monday..
    26 Jan, 12:38 PM Reply Like
  • J Michael McKay
    , contributor
    Comments (26) | Send Message
     
    SA needs to question itself as it publishes NEWS and articles from a Citron on down days in progress. The last three times Citron has been listed as calling out and influencing a stock, prices were already falling, much as they were on Friday due to emerging markets news.
    I have really started to question if News is really manipulation.
    My understanding is that articles are published based on editing and may take time, while news apparently can be used to beat the system.
    I have my doubts about both players after so many successful moves which declare Citron as the cause for these falls. I do not deny they don't add to the fleeing herd, I just think they are allowed to take credit for something broken here.
    28 Jan, 08:44 AM Reply Like
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