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

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Jan 17, 2014, 09:30 ET

CHICAGO, Jan. 17, 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 Stratasys (Nasdaq:SSYS-Free Report), 3D Systems (NYSE:DDD-Free Report), ExOne Company (Nasdaq:XONE-Free Report), Voxeljet (NYSE:VJET-Free Report) and Alexion Pharmaceuticals, Inc. (Nasdaq:ALXN-Free Report).

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Here are highlights from Thursday's Analyst Blog:

3D Printing Stocks Decline

The stupendous run of the 3D printing solution providers such as Stratasys (Nasdaq:SSYS-Free Report), 3D Systems (NYSE:DDD-Free Report), The ExOne Company (Nasdaq:XONE-Free Report) in the previous year came to an abrupt halt after some of them provided lower-than-expected guidance.

In 2013, Stratasys, 3D systems and ExOne generated returns of 45.4%, 115.1% and 114.4%, respectively, compared to a decline of 8.3%, 4.7% and 9.1% in 2014, year-to-date. Another recently-listed 3D printing company Voxeljet (NYSE:VJET-Free Report) was down 5.4% year-to-date.

The major sell-off took place on Tuesday as ExOne lowered its fiscal 2013 revenue guidance and Stratasys provided a lower-than-expected fiscal 2014 forecast. Panic set in and almost all 3D printing stocks were affected.

Stratasys' 2014 guidance indicated that operating expenses would increase significantly due to the incremental investments in sales & marketing and research & development. Moreover, Stratasys expects second-half fiscal 2014 non-GAAP net income to be governed by the rate of adoption of its new products and changing schedules of operating expenses.

Encouragingly, Stratasys expects fiscal 2014 revenues to range between $660 million–$680 million, higher than the fiscal 2013 revenue forecast of $470 million to $490 million. Additionally, the company expects strong organic revenues. Despite these optimistic forecasts, the company's stock was downgraded to a Zacks Rank #5 (Strong Sell). This when accompanied by a 0.00% Earnings ESP does not indicate a favorable forecast for the current quarter.

Another stock that is in the news is ExOne which lowered its FY13 revenue guidance to a range of $40 million to $42 million from $48 million on account of deferment of machine sales to 2014. However, the company remained positive on organic top-line growth which is expected to be in the range of 40% to 50%.

In the trailing four quarters, ExOne posted an average 14.3% positive earnings surprise. However, for the current quarter, the company's Zacks Rank #3 (Hold) and Zacks Earnings ESP of 0.00% makes surprise prediction difficult.

The other two stocks, 3D Systems and Voxeljet, carry a Zacks Rank # 3 (Hold) and a Zacks Earnings ESP of 0.00%. Thus, we are taking a wait-and-see approach to the current quarter as regards these 3D printing stocks.

As such the 3D printing companies operate within a high-cost structure and any sort of disruption in the top line is likely to impact their overall results. Moreover, 3D printing is a relatively new concept and is likely to take time to gain popularity.

Nonetheless, the 3D printing market presents a favorable long-term opportunity as a large number of engineers, designers, architects and entrepreneurs are resorting to 3D solutions for their primary designing and product modeling. We therefore think that the adoption rate and cost control measures will be important factors determining the fortune of companies in this segment.

Prospects Bright at Alexion Pharma

Alexion Pharmaceuticals, Inc. (Nasdaq:ALXN-Free Report) said at the JPMorgan Healthcare Conference that it is on track to deliver 36% and 41% year-over-year growth in revenues and earnings respectively in 2013. The revenue growth is attributable to strong sales of the biopharmaceutical company's sole marketed product Soliris. Soliris is available for the treatment of paroxysmal nocturnal hemoglobinuria (PNH) and atypical hemolytic uremic syndrome (aHUS).

Alexion Pharma expects 2013 revenues in the range of $1.520–$1.530 billion. The company expects adjusted earnings for 2013 in the range of $3.02 to $3.04 per share. The company will provide detailed guidance for 2014 at its fourth quarter 2013 conference call later this month.

Alexion Pharma is expecting six product approvals within the time period of 2014 to 2018 including asfotase alfa (hypophosphatasia), ALXN 1101 (MoCD type A) and Soliris' label expansion. Asfotase alfa is expected to be approved by year end. This will reduce the company's dependence on Soliris for growth.

In a bid to expand, Alexion Pharma inked a deal with the privately held Moderna Therapeutics for the discovery and development of messenger ribo nucleic acid (mRNA) therapeutics to treat patients suffering from rare diseases. The drug discovery platform can expedite the development and manufacture of candidates for treating patients with rare diseases. Under the terms of the deal, Alexion will make an upfront payment of $100 million to Moderna for purchasing 10 product options to develop and commercialize therapies utilizing the mRNA platform. Alexion pharma, which has made a $25 million preferred equity investment in Moderna, will have to make milestone and royalty payments to the latter if situation arises.

We expect Alexion to deliver impressive fourth quarter 2013 revenues driven by strong Soliris sales in the PNH and aHUS indications.

Alexion Pharma carries a Zacks Rank #3 (Hold).

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