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Why Proto Labs Stock Crashed Back 12.6% Today

By Rich Smith - Jan 28, 2021 at 4:51PM

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Don't say you weren't warned.

What happened

I won't say, "I told you so." In fact, I didn't tell you so -- not outright at least. But in discussing Proto Labs' (PRLB 1.17%) remarkable 12.3% jump in stock price yesterday, I think I at least implied that there wasn't any good reason for it and that investors were lumping in Proto Labs stock with a much different story.

So what

Specifically, the story of how 3-D printer-maker 3D Systems (DDD -0.62%) is getting into the human body-parts-printing business.

To refresh your memory, yesterday, 3D announced that it is expanding its partnership with United Therapeutics Corporation (UTHR 1.00%), whereby 3D uses a "Print to Perfusion" process to 3D print scaffoldings that United Therapeutics then uses to grow human tissue, essentially creating artificial human organs for medical research and surgical transportation.

A declining red arrow on a stock chart with a white checked background.

Image source: Getty Images.

Now what

This is cutting edge biotech stuff, folks, and 3D thinks it could be "an exciting growth driver" for its business over the next decade or so. It does not, however, have a whole lot to do with Proto Labs' business, which consists of using 3D printers to manufacture prototypes and small batches of products for primarily industrial customers. I think today other investors may have come to the same conclusion.

After running up 12.3% in share price yesterday, today, Proto Labs stock ran back down 12.6% and closed Thursday trading below where they had begun trading on Wednesday.

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Stocks Mentioned

Proto Labs, Inc. Stock Quote
Proto Labs, Inc.
PRLB
$48.40 (1.17%) $0.56
3D Systems Corporation Stock Quote
3D Systems Corporation
DDD
$9.64 (-0.62%) $0.06
United Therapeutics Corporation Stock Quote
United Therapeutics Corporation
UTHR
$238.00 (1.00%) $2.36

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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