Why 3D Systems Shares Plunged

What: Shares of 3-D printer maker 3D Systems (NYSE: DDD  ) sank 12% today after its quarterly results and guidance disappointed Wall Street.

So what: The company's fourth-quarter adjusted profit of $0.39 easily topped estimates, but a top-line miss -- revenue of $101.6 million versus the consensus of $103.9 million -- coupled with full year 2013 EPS guidance range of $1.00-$1.15 that met estimates of $1.05 but didn't blow them out of the proverbial water. In fact, worries about overvaluation in the space even dragged down the stocks of Stratasys (NASDAQ: SSYS  ) and ExOne (NASDAQ: XONE  ) , which fell as low as 10% and 6%, respectively.

Now what: Management now sees 2013 adjusted EPS of $1.00-$1.15 on revenue of $440 million-$485 million, versus the consensus of $1.06 and $445.9 million. "We entered 2013 with positive sales momentum shaped by increased demand from advanced manufacturing activities," said President and CEO Avi Reichental. "While we may face lingering economic uncertainties in parts of the world, we expect to continue to benefit from robust R&D and manufacturing spending by our customers worldwide." Given the stock's still lofty trailing 12 month P/E of around 50, however, I'd wait for even more of a pullback before buying into that bull talk.

Of course, this short article doesn't even come close to telling the entire story for 3D Systems. To help investors decide whether the future of additive manufacturing is bright enough to justify the lofty price tag on the company's shares, The Motley Fool has compiled a premium research report on whether 3D Systems is a buy right now. In our report, we take a close look at 3D Systems' opportunities, risks, and critical factors for growth. You'll also find reasons to buy or sell, and receive a full year of analyst updates with the report. To start reading, simply click here now for instant access.

Editor's note: A previous version of this article did not factor the recent stock split into the guidance estimate. The Motley Fool regrets the error.



Read/Post Comments (3) | Recommend This Article (14)

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  • Report this Comment On February 25, 2013, at 2:07 PM, leviek wrote:

    I'm just surprise Motley Fool is getting everything so wrong on this DDD report. First, your analyst stated 2013 non-gap EPS is way off from the street, at $1.00 to $1.15. This guidance is after the split guidance. Then, to make matters worse, your talking about a 50 PE stock whereas, based on estimates of $1.00 to $1.15 after split, the stock is selling currently at only 31 times non-gap estimates for 2013. This is a ridiculously low PE for the leader in 3D printing with prospective growth of 25 to 35% annually for the next five years, and I would say closer to 35%.

    I think Motley fool really blew it today.

  • Report this Comment On February 25, 2013, at 2:12 PM, durango58 wrote:

    Need more editing of contributors. Totally erroneous today.

  • Report this Comment On February 25, 2013, at 9:45 PM, andrewupandabout wrote:

    There will be a lot more corrections on these public companies. DDD has good experience in the industry but the world is a large workforce/innovation-machine to contend with. Additionally the latest revenues on materials and printers is showing weakness as so many new entrants are in the market now since 2010.

    Andrew

    3D Printing YouTube Channel:

    https://www.youtube.com/user/andrewupandabout

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