- "While we were anticipating an EPS guide down due to accelerated spending, the magnitude caught us off guard in addition to the unforeseen issues that evolved for the MakerBot segment," writes Piper's Troy Jensen, downgrading Stratasys (SSYS -31.1%) to Neutral following its Q4/2014 warning and soft 2015 outlook.
- Jensen, who had been bullish on Stratasys for a long time: "We believe investor sentiment for this group and Stratasys specifically will remain an issue for the next several quarters, and believe Stratasys shares will remain depressed and out of favor until better execution and upward revisions are more sustainable.”
- Brean's Ananda Baruah, who has downgraded to Hold, notes Stratasys is now trying to sell senior execs on large-scale 3D printing usage, rather than selling on a case-by-case basis. "Given SSYS’s ’15 [op. margin] guidance of 13% (vs. 15% in ’14 and our prior estimate of 17% before last evening’s negative Dec Q preannouncement), we’re moving to a Hold rating while the stock digests the new business model."
- Jefferies' Jason North (Buy) observes MakerBot's latest printers had extruder issues that "led to many angry customers," and that Stratasys' warning suggests growing distribution is also a challenge. He's disappointed with the 2015 outlook, but also views it as conservative.
- Citi's Kenneth Wong (Buy) thinks the bad news is more than priced in, and asserts Stratasys "remains the best franchise in the [3D printing] sector." He adds Stratasys' guidance is historically more conservative than that of peers, and that checks indicate high-end printer demand remains solid. "We believe investors have been searching for a bottom to 3DP sentiment and we have likely hit bedrock."
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Update: JPMorgan and FBR have now downgraded Stratasys as well.