Why Stratasys Shares Surged

While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking upgrades and downgrades -- just in case their reasoning behind the call makes sense.

What: Shares of Stratasys (NASDAQ: SSYS  ) climbed 6% today after JPMorgan upgraded the 3-D printing technologist from neutral to overweight.

So what: Along with the upgrade, analyst Paul Coster reiterated his price target of $101.50, representing about 9% worth of upside to yesterday's close. The stock has slumped recently on management's public offering of nearly 5.2 million shares, but Coster thinks that it provides investors with a juicy entry point given Stratasys' strong position in the rapidly growing 3-D printing space.

Now what: JPMorgan said that Gartner's recent forecast of 3-D printer growth (95% CAGR over the next five years) suggests strong upside to its own outlook (20%-25% CAGR), and that Stratasys is in a particularly good spot to benefit. "Stratasys has achieved a sustainable competitive position in the early adoption phase of a massive, diversified market for 3D printing solutions and is a pure-play for investors seeking exposure to the manufacturing renaissance theme," noted the firm. Of course, with the stock up about 70% from its 52-week lows and trading at a forward P/E of 40, I'd wait for some of the enthusiasm to fade again before jumping in.

A Look Into the Future of 3-D Printing
If someone asked you, “Why invest in 3D Systems?” Could you truly answer them? To be honest, few investors could. That’s because most of the company’s secrets—the ones that make savvy market watchers rich—often fly below the radar. If you want an edge on other 3D Systems investors, be sure to check out "5 Secrets to 3D Systems' Future" from The Motley Fool. This 100% FREE guide includes actionable advice that you can put to use right now! Just click here now for instant access!


Read/Post Comments (0) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2677008, ~/Articles/ArticleHandler.aspx, 4/23/2014 9:21:05 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement