At the beginning of 2012, I set out to form The World's Greatest Growth Portfolio.  Though I can't promise it will always live up to its moniker, the portfolio has returned 23% in just 11 months, beating the S&P 500 by about 9 percentage points.

A few weeks ago, I outlined  exactly how I would go about building my portfolio for next year: Invest first and foremost in companies that demonstrate exceptional levels of innovation, with special emphasis given to those that I believe will be around decades from now.

Today, I'm going to look at Stratasys (SSYS -0.40%). Earlier, I covered the basics of its main rival, 3D Systems (DDD -1.00%), to compare each company's strengths and weaknesses.

Read all the way to the end, and I'll offer access to a special premium reports on one of the companies that dives much deeper than I can in just one short article.

Before getting started, though, it's important to know exactly what 3-D printing is. To read an article on the basics, click here.  Or if you want a visual example of what the technology could be someday, think about how the main character was reconstructed with a machine in the cinematic hit The Fifth Element.

A very rewarding investment
Unlike 3D Systems, which I decided to bypass for 2012's Growth Portfolio, Stratasys was tabbed as a member. Over the first nine months of 2012, the company was able to increase its stash of cash by 50%,  while growing revenues by 28.3%. Although net income fell by 14.2%, it didn't really seem to matter too much to investors: The stock is up about 140% on the year.

There are two big reasons the stock is up even though earnings are down for the year. First off, Stratasys has devoted far more money to building out its distribution network. That accounts for why selling, general, and administrative costs are up 47%.  Previously, the company had a deal in place with Hewlett-Packard (HPQ 2.04%) to help distribute the company's 3-D printers, but that agreement failed to ever make progress and has since been scrapped.

The second reason the stock isn't suffering is because investors generally cheered the now-accepted merger of Stratasys with Objet. The Israeli-based Objet, which was probably the third biggest player in the industry, was planning on going public but decided to merge with Stratasys instead.

The merger allows Stratasys to gain access to markets it was previously outside of, and Objet's technology compliments that of Stratasys.

Time will tell how the merger works out, but for the time being, Stratasys is making its big leaps because of its Fortus line of printers. The printers help design concept models and functional prototypes for industrial customers, but they can also build manufacturing tools and end-use parts -- which can be a game-changer.

What's the bottom line?
When reviewing 3D Systems, I already made it clear that it would probably get the lowest allocation in my 2013 portfolio. Those are companies that show high levels of innovation, but are not necessarily guaranteed to be around in 10 years.

Though I think that, for my money, Stratasys is a better investment than 3D Systems, I'd probably have to lump the company in the same category with 3D Systems. The field of 3-D printing is simply too young and changing too fast to be able to get a great read on what the future may hold. As it stands, I may just be satisfied to hold both of these companies as Tier Two holdings in 2013.

If you'd like to find out more about 3-D Systems, Stratasys' main competition, we have just the things for you.