Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
Why It's Happening: In the second quarter, Stratasys' revenue increased by about 2% year over year to $182.3 million, translating to a net loss of $0.55 per share, or an adjusted net profit of $0.15 per share. These results fell in line with Wall Street expectations calling for Stratasys to generate $182 million in revenue and earn $0.15 per share in adjusted earnings.
The market doesn't seem to have taken kindly to the fact that Stratasys withdrew its full-year guidance, but provided guidance for the third quarter, which fell significantly below analyst expectations.
In the third quarter, Stratasys anticipates to generate between $175 million and $190 million in revenue and earn between $0.03 and $0.13 per share on an adjusted basis, whereas Wall Street was hoping it would generate $216.5 million and earn an adjusted $0.47 per share.
As far as 3D Systems is concerned, the 3D printing company is slated to report its second-quarter earnings on Thursday, August 6. At the time of this writing, Wall Street expects 3D Systems to grow its sales by nearly 15% year over year to $173.7 million and take home $0.09 per share in adjusted earnings.
It seems this is a classic sympathy sell off, where 3D Systems investors are reacting negatively to a downbeat development from a competitor. Fortunately, investors won't have to wait long to find out if today's action was warranted.
Steve Heller owns shares of 3D Systems. 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.