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How Did These 2 Stocks Soar Despite the Market's Tuesday Plunge?

By Dan Caplinger - Updated May 11, 2021 at 5:02PM

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Find out how a couple of standouts defied the big drop.

Stock market nervousness jumped up a notch on Tuesday morning, as Wall Street reacted poorly to rising signs of inflation and other threats to the ideal conditions that have spurred the huge bull market in stocks over the past year. Major market benchmarks saw steep losses, with stocks in the energy and technology sectors getting particularly close attention from investors. As of 11:15 a.m. EDT, the Dow Jones Industrial Average (^DJI 0.83%) was down 622 points to 34,121. The S&P 500 (^GSPC 0.79%) dropped 63 points to 4,126, and the Nasdaq Composite (^IXIC 0.69%) gave up another 121 points to 13,281.

Even with the declines throughout the market, there were some bright spots among individual stocks. One of the best performers was Roblox (RBLX 8.94%), which is a company that's well known among those with kids of a certain age. Meanwhile, 3D Systems (DDD 7.18%) also had a great day as investors gained confidence in the 3D printing company's future.

A roaring brown bear in a snowy forest

Image source: Getty Images.

Roblox builds up momentum

Shares of Roblox climbed more than 11% on Tuesday morning. The online game platform provider and newly public company announced blowout quarterly results that confirmed the hopes that many shareholders have for its growth prospects.

Roblox's first numbers as a publicly traded company following its direct listing in March were sensational. Bookings soared 161% year over year, pushing recognized revenue higher by 140% from year-ago levels. Monetization efforts were highly successful, as free cash flow came in at quadruple the level it was this time in 2020. More players are using Roblox than ever, with daily active user counts climbing 79% to 42.1 million. Overall, players spent 9.7 billion hours on the platform, nearly double year-earlier time spent.

Roblox is getting a lot of interest from a couple of key demographics. First, the company has sought to go beyond the young kids that were its initial core audience, and it saw dramatic growth in hours engaged and daily active user counts from players over 13 years old. In addition, Roblox has sought to gain international appeal, and growth in key metrics outside the U.S. and Canada far exceeded what the company saw in its home market.

Investors have been excited about Roblox since before it came public. If the game platform can keep gaining in popularity, then today's rise in the stock could be just the beginning.

Printing money

3D Systems had an even better day, rising 22%. The 3D printing specialist announced a profitable quarter and saw revenue move up from year-earlier levels.

3D Systems' numbers were solid. Revenue climbed 8% year over year on a 16.6% rise in organic sales. The top-line gains came despite the fact that 3D Systems made a number of divestitures in 2020 that reduced the scope of its overall operations. Net income came in at $45.2 million, reversing a year-ago loss of $18.9 million. Adjusted earnings of $0.17 per share returned 3D Systems to profitability.

CEO Jeff Graves was pleased with the progress that 3D Systems has made in its turnaround plan. Graves pointed to exceptional strength in the company's healthcare segment, while industrial sales stabilized as a global reopening starts to spur demand. Efforts to keep costs in check have also paid off on 3D Systems' bottom line.

The company's stock has gotten caught up in the same pullback that has hit a number of cutting-edge companies. It could take some time, but 3D Systems appears to be on the right path to recovery.

Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool recommends 3D Systems. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Roblox Corporation Stock Quote
Roblox Corporation
RBLX
$52.30 (8.94%) $4.29
Dow Jones Industrial Average (Price Return) Stock Quote
Dow Jones Industrial Average (Price Return)
^DJI
$33,585.06 (0.83%) $275.55
S&P 500 Index - Price Return (USD) Stock Quote
S&P 500 Index - Price Return (USD)
^GSPC
$4,243.48 (0.79%) $33.24
NASDAQ Composite Index (Price Return) Stock Quote
NASDAQ Composite Index (Price Return)
^IXIC
$12,943.27 (0.69%) $88.46
3D Systems Corporation Stock Quote
3D Systems Corporation
DDD
$12.68 (7.18%) $0.85

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

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