There's never a dull week in the 3-D printing space, and this holiday-shortened business week was no exception. 3D Systems (NYSE:DDD), the industry's largest company by market cap, was the headliner, though fellow bigwig Stratasys (NASDAQ:SSYS) and even Wal-Mart (NYSE:WMT) had supporting roles.
3D Systems raises $317 million and raises speculation about acquisitions
3D Systems announced a secondary stock offering of 5.95 million additional shares after the market closed on Tuesday. Early Wednesday, the company said it priced the offering to raise gross proceeds of approximately $317 million, which equated to a share price of about $53.28. This offering dilutes current shareholders' ownership of the company by 5.7%, as 3D Systems had 103.51 million shares outstanding at the time of the announcement.
While secondaries involving issuance of new shares are always greeted negatively because of the dilution effect, the market seemed particularly unhappy with this news. It punished the stock more than 11% on Wednesday, driving the share price down to $50.44. Shares did, however, claw back 1.8% on Thursday, and are up nearly 1% in early trading Friday.
3D Systems intends to use the proceeds from the offering to finance future acquisitions, for working capital, and for general corporate purposes. While many are skeptical of growth-by-acquisition strategies, 3D Systems has a solid track record of buying profitable companies that are quickly accretive to its earnings. If the company spends as wisely as it has in the past, the short-term pain for shareholders could result in long-term gain. You can read more details on the situation and my thoughts on how the company might use the proceeds here.
Wal-Mart plans to implement 3-D printing activities
On Thursday, The Wall Street Journal reported that new Wal-Mart CEO Doug McMillon said on Wednesday at the Code Conference that the retailing behemoth plans "to ramp up dealmaking and implement new technologies such as 3-D printing to change the shopping experience in its stores." The report added:
Mr. McMillon called out 3-D printing as a technology that could be used in stores for customers to quickly print new products and in distribution centers to speed up shipments. He said the company has recently tested 3-D printers in its stores, letting customers create miniature models of themselves. "We can't keep them in stock," he said.
So Wal-Mart is apparently exploring several ways in which it may implement 3-D printing. The scenario of using 3-D printers in its distribution center to speed up shipments is a considerable way off for most products, in my opinion. Many products are made from several different types of materials, and even today's high-end printers can't print most multimaterial items. The cost of 3-D printing materials would also likely have to come down considerably for this plan to be cost-effective on all but the pricier products. Speed is likely another limiting factor. Great strides, however, will surely be made in these areas, so I do think this scenario could play out in the future. Three-dimensional printing will never fully displace traditional manufacturing, especially on lower-end goods, but rather act as a supplement.
It didn't surprise me to hear that customers in Wal-Mart's test stores couldn't get enough of 3-D printing miniature models of themselves. I've previously written about Walt Disney's 3-D printing initiatives, which have included the entertainment giant using 3-D printing in a similar way at its theme parks; these offerings also were very popular. Given Wal-Mart's success in its test stores, it seems likely that it will start installing 3-D printers in many locations.
3D Systems takes a bigger bite out of the dental market
3D Systems announced on Thursday that its ProJet 3510 and VisiJet Pearlstone material were verified by 3Shape for high-precision prosthodontic dental model production. 3Shape is a Danish company that develops 3-D scanners and CAD/CAM software.
This means that 3D Systems' ProJet 3510 and its Pearlstone materials have been integrated into 3Shape's Model Builder software. 3Shape's customers can now use ProJet 3510 and the Pearlstone materials to produce dental models. Furthermore, 3Shape added 3D Systems as a manufacturing output provider in its software, which means customers without a 3-D printer can order dental models directly from 3D Systems through the software.
Stratasys' MakerBot launches store-within-a-store in New York City
Also on Thursday, Stratasys' MakerBot unit and B&H Photo Video announced the MakerBot store-within-a-store opening at the B&H SuperStore in New York City. This is the first store-within-a-store for MakerBot, and its largest retail experience outside of its own MakerBot stores in New York, Boston, and Greenwich, Conn.
B&H specializes in professional photo, video, printing, and audio products and services. Its New York SuperStore has had much success selling MakerBot Replicator 3-D printers, so this new initiative sounds like a great fit. I'd not be surprised to see Stratasys launching more of these concepts in similar stores in major cities.
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Beth McKenna has no position in any stocks mentioned. The Motley Fool recommends 3D Systems and Stratasys. The Motley Fool owns shares of 3D Systems and Stratasys. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.