Why Stratasys Shares Soared

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of three-dimensional-printing technologist Stratasys (NASDAQ: SSYS  ) surged 11% today after its quarterly results topped Wall Street expectations.

So what: Stratasys has surged over the past year on voracious demand for its products, and today's first-quarter beat -- adjusted EPS of $0.43 versus the consensus of $0.38 -- suggest that the trend isn't slowing. In fact, revenue for the quarter more than doubled to $97.2 million, reinforcing optimism over other 3-D printing plays -- 3D Systems (NYSE: DDD  ) and ExOne (NASDAQ: XONE  ) are both up about 5% -- as well.

Now what: For the full year, management said it still sees adjusted EPS of $1.80-$1.95 on revenue of $430 million-$445 million, versus the average analyst estimate of $1.89 and $436.9 million. "Although merger-related integration will remain a focus in 2013, our leading priorities remain serving our customers and investing in future growth," said CEO David Reis. "We remain excited about the many opportunities we see developing for Stratasys and our innovative products." With the stock now up more than 120% from its 52-week lows and trading at a forward P/E of 40, however, I'd wait for some of the exuberance to fade before buying those prospects.

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  • Report this Comment On May 14, 2013, at 4:40 PM, TangoXray7 wrote:

    It's one thing to celebrate SSYS for beating expectations, another entirely to conflate that event with the run up in 3D.

    3D Systems just diluted shares to the tune of nearly 10%, but the stoick went up rather than down. Why? With a published price of $40/share on over six and a half million shares, the stock is now selling at $48? Very odd.

    Here's a hint: the trade announced last Thursday after the market closed won't settle until tomorrow. Expect the bloodletting to begin...

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