Please ensure Javascript is enabled for purposes of website accessibility

Why 3D Systems Stock Fell 23% in March

By Beth McKenna - Apr 1, 2021 at 8:12PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The 3D printing company's release of its fourth-quarter and full-year 2020 results likely disappointed investors for at least two reasons.

What happened

Shares of 3D Systems (DDD -0.57%), a diversified 3D printing company, dropped 23.4% in March, according to data from S&P Global Market Intelligence

For context, the S&P 500 index returned 4.4% last month.

Close-up of a 3D printer producing a bright yellow plastic object.

Image source: Getty Images.

So what

We can attribute 3D Systems stock's weak performance last month largely to investor disappointment related to the company's March 1 release of its fourth-quarter and full-year 2020 results. Shares plunged 19.6% the next day.

The two main reasons investors were likely not happy:

  • Results were only preliminary, as the company was delayed in filing official (audited) results.
  • Management didn't issue revenue or earnings guidance.

DDD Chart

Data by YCharts.

Now what 

Reiterating what I wrote in my Q4 earnings article:

3D Systems made good progress in its turnaround in 2020: It cut costs, it paid off its debt, and it ended the year on a solid note. In Q4, it grew revenue year over year (albeit very modestly) and was profitable on an adjusted basis. Moreover, it also achieved slightly positive GAAP [generally accepted accounting principles] operating income.

That said, investors shouldn't throw all caution to the wind. The stock is very loftily priced after soaring 270% in 2021 through Monday's [March 1] regular trading session.

For the first quarter of 2021, Wall Street is expecting 3D Systems to post adjusted earnings per share (EPS) of $0.01 on revenue of $136.4 million. In the year-ago period, the company had an adjusted loss per share of $0.04 on revenue of $134.7 million. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

3D Systems Corporation Stock Quote
3D Systems Corporation
DDD
$10.40 (-0.57%) $0.06

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

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
330%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/22/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.