The Zacks Analyst Blog Highlights: Voxeljet, ExOne, 3D Systems, Materialise and Stratasys

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Dec 30, 2014, 09:42 ET

CHICAGO, Dec. 30, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Voxeljet AG (NYSE:VJET-Free Report), ExOne Company (Nasdaq:XONE-Free Report), 3D Systems Corp. (NYSE:DDD-Free Report), Materialise NV (Nasdaq:MTLS-Free Report) and Stratasys Ltd. (Nasdaq:SSYS-Free Report).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Monday's Analyst Blog:

3D Printing Stocks Surge: 2015 Rebound in the Cards?

Friday marked a significant turnaround for the beaten-down 3D printing sector, as short-covering fuelled a strikingly bullish session for most of the stocks. The most impressive rally was seen in Voxeljet AG (NYSE:VJET-Free Report), which gained over 26%, followed by The ExOne Company (Nasdaq:XONE-Free Report), which rose over 17% in the session.

Other notable names in the space that saw favorable price movements were 3D Systems Corp. (NYSE:DDD-Free Report), up nearly 8% and Materialise NV (Nasdaq:MTLS-Free Report), up almost 5%.

Among these, ExOne and 3D Systems had the highest short float percentages, followed by Stratasys Ltd. (Nasdaq:SSYS-Free Report), which gained a modest 3%.

3D printing technology generated immense enthusiasm in 2013, captivating people with wide-ranging speculations about extensive applications of 3D printing. Stocks charted huge gains during that period. However, the beginning of 2014 saw the stocks tumbling down, as people realized the huge costs and complexities involved in the technology.

Since then, these high-flier stocks have been in troubled waters. Year-to-date, industry leader 3D Systems has plummeted 65%, while Voxeljet and ExOne plunged 77% and 70%, respectively.

Future Prospects?

Once plain conjecture, 3D printing's potential to revolutionize manufacturing is fast becoming a reality. Companies are now working on solutions that range from simple make-to-stock orders to complex, engineer-to-order production strategies.

The trillion-dollar oil & gas industry is entering the foray as a prospective end-market for 3D printing, while aerospace and defense are established users of the technology. Potential applications range from customized plastic items to difficult-to-find metal parts for cars and jet engines, as well as biomedical revolutions like 3D-printed tissue and organs.

In a recent research report, PricewaterhouseCoopers predicted that 3D printing technologies will take giant strides in the coming three to five years, gaining relevance in manufacturing commercial, military and complex weapon parts and system components.

According to analytical firm Canalys, the 3D printing market will grow to $16.2 billion by 2018. IDC expects worldwide 3D printer unit sales and installed base to grow at a combined compound annual growth rate of 59% through 2017.

In order to capitalize on the industry's robust prospects and consolidate their market share, established companies might take the acquisition route as a way to achieve quick growth. Over the last few years, 3D Systems has been very active in this space and has acquired many smaller 3D printing companies.

Only recently, the company announced its plans to buy 3D printing software producer, Cimatron, for $97 million. Also, Voxeljet and ExOne could be potential takeover targets following the considerable drop in share price that the two firms have seen in the past year.

Will Entry of Major Players Bring Turnaround in the Sector?

The industry's potential has been highlighted by the recent announcements of a couple major players. Last month, GE announced its plans to build a $32 million 3D printing facility in Pittsburgh. The industrial giant, already employing 3D printing technology for select products, expects the new facility to expand the potential applications of the technology across products ranging from light bulbs to jet engines.

More importantly, Hewlett-Packard is planning a re-entry into the market, with its revolutionary 3D printing technology named Multi Jet Fusion. As emphasized by Hewlett-Packard, Multi Jet Fusion optimizes the relationship between price and functionality and is 10 times faster than other devices available in the market.

The entry of these players will act as a catalyst for the industry and has the potential to redefine market dynamics in the troubled 3D printing space. Investors should watch out for the 3D printing space in 2015, as the industry seems to be on the brink of major transformation, with expanding end markets and burgeoning applications for the technology.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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