Seeking Alpha

3D Systems Corp. (DDD)

  • Tue, Apr. 28, 4:17 PM
    • Stratasys (NASDAQ:SSYS) expects Q1 revenue of $171M-$173M and EPS of $0.02-$0.04, well below a consensus of $198.8M and $0.29. Gross margin is expected to fall by 190 bps Q/Q, large thanks to mix changes.
    • Full-year revenue and EPS guidance is now at $800M-$860M and $1.20-$1.70, below a consensus of $943.1M and $2.10.
    • The warning comes four days after one from 3D Systems, and 3 months after Stratasys issued a Q4 warning and provided soft 2015 guidance. The Q1 shortfall is blamed on lower capital spending in "certain regions and industries" (particularly in North America), an $8.7M forex hit, M&A activity among channel partners, a slower-than-expected Asia-Pac/Japan channel ramp, and slower-than-expected adoption of Stratasys' high-end Connext printers, following the launch of 8 Connect products in 2H14.
    • MakerBot revenue was down 18% Y/Y. A fresh $150M-$200M impairment charge is expected for the unit, which recently launched job cuts.
    • The company plans to immediately cut its operating expenses and capex. It still expects opex to equal 46%-47% of 2015 revenue. The 2015 capex budget is now at $80M-$110M. Full Q1 results arrive on May 11.
    • While Stratasys is halted for now, 3D Systems (NYSE:DDD) has fallen to $25.00 in AH trading.
    • Update (6:35PM ET): Shares are down 17.6% AH after resuming trading.
  • Mon, Apr. 27, 9:46 AM
    • Canaccord has downgraded 3D Systems (NYSE:DDD) and Stratasys (NASDAQ:SSYS) to Hold in the wake of 3D's Friday Q1 warning. UBS and Piper have respectively downgraded 3D to Sell and Underweight.
    • Piper's Troy Jensen, who has cut his target all the way to $21, thinks the Q1 warning suggests 3D will have to "materially cut" full-year guidance when it reports on May 6, that its issues are "bigger than the company is communicating," and that "pending competition will prevent the company from rebounding from this depressed competitive state." He provided cautious reseller survey data 3 days before the warning.
    • Canaccord, discussing its 3D downgrade: "[G]rowth for professional and production grade printers appears to be slowing. We believe customers are scrutinizing their purchasing decisions more closely following a period of accelerating adoption, especially for non-metal processes. We also think that HP's (NYSE:HPQ) growing marketing presence (no machine until late 2016) is causing some dissonance in the market and is being used as an excuse to delay decisions." The firm thinks Stratasys is affected by slowing industry demand as well.
    • Oppenheimer is "grudgingly" keeping an Outperform rating on 3D. "We believe revenue growth is running well below its 'normalized' trend given industry dynamics, and there is great potential for it to bottom and recover ... Valuation is no longer a catalyst, and it will take time to repair the significant (and deserved) reputational damage stemming from recent performance. But we still see the longer term potential as outstripping the risk..."
    • Credit Suisse (Neutral): "Management is confident demand will return in subsequent quarters as OEMs have adjusted to the current environment and orders have picked up in Q2; we remain cautious given the recent trend of missed quarterly expectations."
  • Fri, Apr. 24, 9:17 AM
  • Fri, Apr. 24, 8:43 AM
    • Oppenheimer comments on 3D Systems Q1 earnings pre-announcement:
    • "3D Systems pre-announced dismal 1Q15 results, and will host an 8:30 a.m. EDT call today to discuss further.
    • "The gist is that sales were weak again, and as in past quarters, the reasons endlessly shift. Not all has gone wrong, but for every encouraging item over the last two or three quarters, two or three bad ones (and never the same bad ones!) keep popping up, undermining confidence in management and the story. This clearly constitutes a deep disappointment."
    • DDD now -11.3% premarket.
    • Previously: 3D Systems warns on weak Q1, blurry FY outlook, shares -14% (Apr. 24)
  • Fri, Apr. 24, 8:10 AM
    • 3D Systems (NYSE:DDD) sees Q1 EPS of $0.02-0.04, vs. consensus $0.17.
    • Sees Q1 revenue of $158-160M, vs. consensus $182.78M.
    • "We were surprised and disappointed by the abrupt interruption in customer demand late in the quarter from several economic factors that we believe caused our industrial customers to defer their planned investments.
    • "We believe the combination of our expanding international business and growing concentration of manufacturing customers made us more vulnerable to the steep currencies decline relative to the U.S. dollar and the aftermath of lower oil prices that curbed aerospace and automotive expenditures.
    • "Several weeks into the second quarter, bookings are ahead of the same period in the first quarter. Specifically, OEMs that paused to assess their own exposure to foreign currency and macroeconomic impacts are beginning to resume their capital investments and are making the purchases they deferred during the first quarter.
    • "Given current uncertainties from continued macroeconomic pressures and foreign currency headwinds, management is undertaking a comprehensive evaluation of its full year guidance and plans to update investors during its scheduled first quarter 2015 earnings conference call on May 6, 2015.
    • "While the current economic climate disrupted our planned cadence for 2015, we believe that the fundamentals of our business and the strength of our portfolio remained intact. We are encouraged by the overall strengthening of our order patterns thus far during the second quarter and are accelerating our planned integration, productivity and efficiency measures without impairing future growth."
    • DDD -14% premarket.
    • Source: Press Release
  • Tue, Apr. 21, 3:12 PM
    • Citing survey results from 62 3D printing resellers and service bureau owners, Piper thinks the 3D printing industry saw a "modest downtick" in Q1, with "much more aggressive sales tactics" and "creative financing" used towards the end of the quarter.
    • The survey pointed to poor demand for 3D Systems' (NYSE:DDD) products, with resellers unhappy about both demand and 3D's channel management.
    • Unlike prior quarters, the survey didn't point to above-plan Stratasys (NASDAQ:SSYS) results. Piper still thinks the company can hit Q1 consensus estimates, but no longer considers its guidance conservative.
    • 3D and Stratasys have sold off in spite of a 0.5% gain for the Nasdaq.
    • Previously: Canalys expects 56% 2015 3D printing industry growth
  • Sat, Apr. 18, 5:57 PM
    • Though 3D printer makers have seen their shares pummeled in 2014 and early 2015 thanks to a mixture of earnings disappointments, margin/spending concerns, and multiple compression, Canalys forecasts total sales of 3D printers and related materials/services will rise another 56% in 2015 to $5.2B. It also forecasts a 44% industry CAGR from 2014-2019, leading revenue to reach $20.2B.
    • Canalys' Joe Kempton notes improving printer speeds, the availability of new materials, and the launch of new manufacturing methods have boosted growth. He also observes patent expirations have helped the vat polymerization segment of the 3D printer market grow rapidly; material extrusion printers have historically held a much larger shipment share.
    • At the same time, Kempton points out there has been a major increase in the number of industry players, particularly from Asia. "In the next five years, more companies will move in to establish their own niches ... Long-existing vendors such as Stratasys (NASDAQ:SSYS) and 3D Systems (NYSE:DDD) are well placed to take advantage of this growth but may find their dominant positions challenged by newer rivals."
    • The aerospace, automotive, and medical markets are expected to remain major enterprise growth drivers, as firms such as GE, Boeing, and BMW continue investing heavily in 3D printing. On the consumer side, $500 is seen as the "sweet spot at which many consumers are likely to make impulsive purchasing decisions; " 3D Systems' Cube printer goes for $999. Kempton also argues performance, materials, and software improvements are still needed for consumer adoption to take off.
    • Other 3D printing industry firms: XONE, VJET, OTCPK:AMAVF, MTLS, CAMT, ARCW
    • Yesterday: Stratasys' MakerBot unit conducts layoffs
    • Three days ago: 3D printing stocks up strongly amid NYC conference
  • Wed, Apr. 15, 12:32 PM
    • Beaten-down/well-shorted 3D Systems (DDD +4.6%), Stratasys (SSYS +3.7%), Voxeljet (VJET +4.4%), and Organovo (ONVO +5.2%) are posting big gains. Volume has been slightly above-average for ONVO, normal for DDD and SSYS, and below-average for VJET. The Nasdaq is up 0.5%.
    • Meanwhile, 3D printing/manufacturing service provider ARC Group (ARCW +12.1%) is soaring after Brean reiterated a Buy rating, albeit while cutting its target by $13 to $12 (still over 2x yesterday's close). The firm thinks EBITDA margin can rise to 18% by year's end from a current 14%, and to "at least 20%" in 2016. It also thinks improving demand from the firearms could drive upside to its estimates.
    • The gains come amid NYC's 3D Print Week conference. Both 3D Systems and Stratasys' MakerBot unit (based in Brooklyn) have large presences. As does 3D printing software vendor Materialise (MTLS +2.5%), which is sponsoring the conference's 3D Print Fashion Show and providing a closing keynote.
    • Separately, MakerBot has announced a reseller deal with D&H Distributing, an SMB-focused IT distributor for education, healthcare, government, and manufacturing clients. And Stratasys proper has rolled out a new high-end system (the Objet1000 Plus) said to print parts 40% faster than its predecessor, and at a lower cost.
    • Last week: 3D Systems rallies towards $30
  • Fri, Apr. 10, 2:25 PM
    • 3D Systems (NYSE:DDD) has gradually rallied today to its highest levels since early March. Volume (2.61M shares) is already near a 3-month daily average of 2.64M.
    • Friday short-covering could be helping the beaten-down 3D printer maker's cause: As noted by SA author Bill Maurer, 38.6M shares were shorted as of March 13, a record high and equal to over 36% of the float.
    • 3D currently trades for 32x 2015E EPS and 24x 2016E EPS. 2015 and 2016 revenue growth consensus estimates are respectively at 31.3% and 23%.
    • Four days ago: 3D Systems buys Chinese 3D printing services firm
  • Mon, Apr. 6, 10:44 AM
    • Acquisition-hungry 3D Systems (DDD +1.6%) has bought Easyway, a leading Chinese 3D printing reseller and service bureau. Terms are undisclosed.
    • 3D notes Easyway has operations in 5 major Chinese cities, as well as relationships with Volkswagen, Nissan, Philips, Black & Decker, Panasonic, and Honeywell. Easyway founder May Zhou has been named the head of a new 3D Systems China unit.
    • 3D has already bought several 3D printing service bureaus; Belgian metal printing service bureau LayerWise was acquired last summer. Shares are higher following today's announcement.
    • Last week: 3D Systems forms 3D-printed prosthetics partnership
  • Thu, Apr. 2, 7:00 PM
    • 3D Systems (NYSE:DDD) has formed a multi-year partnership with UNYQ, a maker of 3D-printed prosthetic covers, to "actively invest in bringing 3D printing technologies to the prosthetics and orthotics industries."
    • The companies state 3D will contribute its "vast portfolio of prosthetic and orthotic devices and advanced manufacturing expertise," and that UNYQ will provide "knowledge in cost-effective production and [a] nimble go-to-market approach."
    • Back in 2012, 3D bought 3D-printed prosthetic/orthotics maker Bespoke Innovations. UNYQ will "bring to market many of Bespoke's original designs," as well as add 3D's prosthetic fairings and orthotics to its product line.
    • 3D's healthcare revenue rose 96% Y/Y in Q4. That figure was boosted by the $120M acquisition of surgical simulator maker Simbionix, as well as the purchase of surgical 3D imaging/modeling product maker Medical Modeling. Simbionix recently launched new training modules for arthroscopic 3D training simulator.
  • Mon, Mar. 2, 9:44 AM
    • Stratasys' (NASDAQ:SSYS) Q4 revenue was slightly above the guidance implied by its Feb. 2 warning, and EPS in-line. The company is reiterating the 2015 revenue and EPS guidance provided in the warning - $940M-$960M and $2.07-$2.24, respectively - as well as expectations 2015 EPS will be "derived disproportionately" from 2H15. Long-term growth/margin targets are also reiterated.
    • Q4 product revenue (hurt by MakerBot pressures) +25% Y/Y to $168.6M, a notable slowdown from Q3's 48%. Services revenue +141% to $48.5M, after growing 145% in Q3. 11,214 3D printing/additive manufacturing systems were sold, and MakerBot revenue totaled $26.6M.
    • Gross margin was 56%, down from 58.3% in Q3 and 60.2% a year ago. SG&A spend +61% Y/Y to $75.3M; R&D +38% to $23.2M.
    • 3D Systems (NYSE:DDD) is following Stratasys higher. This morning, 3D announced it has added Henry Schein (NASDAQ:HSIC), the top provider of healthcare products/services to office-based dental, animal health, and medical practitioners, as a distributor. Henry Schein will resell 3D's ProJet 1200 and 3510 3D printer lines to dental lab customers.
    • Stratasys' Q4 results, PR
    | Comment!
  • Mon, Mar. 2, 9:32 AM
    • Medical products distributor Henry Schein (NASDAQ:HSIC) enters into a multi-national distribution agreement with 3D Systems (NYSE:DDD) for its 3D printers for use in dental laboratories in the U.S., Canada, France, Germany, Australia and Thailand.
    • Under the terms of the contract, Schein will market and sell 3D's micro-SLA ProJet 1200 and ProJet 3510 DPPro as part of its digital dental lab offering.
    • Henry Schein is the world's largest healthcare products distributor, carrying over 100,000 products to over 1M customers in 28 countries.
  • Thu, Feb. 26, 9:51 AM
    • Though it missed Q4 estimates, 3D Systems (DDD +1.5%) is guiding for 2015 revenue of $850M-$900M and EPS of $0.90-$1.10, in-line with a consensus of $873.2M and $1.02.
    • Also: Capex is expected to remain at 3% of revenue, and M&A activity (very aggressive in recent years) is expected to "moderate" as 3D "decisively shifts its focus towards leveraging recently acquired assets to generate greater profitability progressively throughout 2015."
    • 3D does note its sales are pressured by "delayed new products and gaps in its North American channel performance," and that it "may take several periods" to address the issue. It adds forex is expected to be a headwind (as it is for many other companies), and that the discontinuation of legacy products and "pruning" of lower-margin services will also take a toll. A lot of this was advertised by the company's October warning.
    • Product revenue rose 16% Y/Y in Q4 to $129.1M, and services revenue 33% to $58.3M. Metals printing and healthcare were strong points, respectively rising 178% and 96%. Consumer revenue rose 68% in spite of recent challenges.
    • Gross margin was 47.9%, roughly flat Q/Q but down from 52.1% a year ago. Operating expenses rose 38% Y/Y to $85.5M (compares with 21% revenue growth).
    • ExOne (XONE +2.8%) is following 3D Systems higher. Expectations for 3D printer makers are a lot lower than they were a few months ago.
    • Q4 results, PR
  • Thu, Feb. 26, 8:02 AM
    • 3D Systems (NYSE:DDD): Q4 EPS of $0.21 misses by $0.04.
    • Revenue of $187.4M (+21.0% Y/Y) misses by $14.92M.
    • Shares -4% PM.
    • Press Release
  • Wed, Feb. 25, 5:30 PM
Visit Seeking Alpha's
DDD vs. ETF Alternatives
Company Description
3D Systems Corp through its subsidiaries is engaged in providing 3D printing centric solutions, including 3D printers, print materials and cloud sourced custom parts.
Sector: Technology
Country: United States