This Tech Sector About to See Explosive Growth?
The 3D-printing sector may be currently in an impasse but trust me folks, when I say the sector will be significant going forward and a buying opportunity as the price of the 3D-printing machines fall. My stock analysis is that 3D printers will become a common sight on the desk of many homes.
Recall what happened when the laser printer first debuted in May 1984 with Hewlett-Packard Company’s (NYSE/HPQ) desktop laser printer. The initial cost was staggeringly high at more than $3,000, but now a laser printer sells for less than $100.00. The same thing will happen for the 3D printer as prices start to decline, based on my stock analysis.
As my stock analysis indicates, 3D-printing technology will be a big winner going forward in nearly every area, from manufacturing to medical devices and technology.
The size of the 3D-printing and associated services market could jump to more than $6.0 billion by 2018, according to Citibank analyst Kenneth Wong. (Source: “3D Printing Market to Triple by 2018,” Business Wire, August 27, 2013.) As Wong notes, the catalyst for the growth will begin with the expiration of key patents in 2014 that will drive prices lower.
Even athletic shoemaker New Balance is using the 3D-printing technology to produce customized shoes for elite athletes. (Source: “New Balance Pushes the Limits of Innovation with 3D Printing,” New Balance web site, March 7, 2013.) I expect the 3D service will eventually be available for everyday purchases once 3D-printing machines become more readily available.
At this point into the race, my stock analysis suggests that the leaders in this sector are Stratasys Ltd. (NASDAQ/SSYS), with a market cap of about $6.24 billion, and 3D Systems Corporation (NYSE/DDD), with a market cap of about $7.99 billion.
On the small-cap side, an interesting stock to watch and keep an eye on is Friedberg, Germany-based voxeljet AG (NASDAQ/VJET), which has a $349-million market cap, as my stock analysis indicates.
Voxeljet made its initial public offering (IPO) debut on October 18, 2013 at $20.00 and surged to $70.00 on November 18, but it has not been an easy ride since, with the stock price falling to its current level around $34.00.
The company makes high-speed, large-format 3D printers and on-demand parts services geared for industrial and commercial customers. The move to the retail market is not there yet, but my stock analysis suggests that it will only be a matter of time before this occurs.
The valuation is extreme at this time, trading at 388X its estimated 2014 earnings per share (EPS), but the stock must be analyzed as far as its potential and not its valuation, according to my stock analysis.
Based on my stock analysis, Voxeljet has what it takes to deliver.
Annual revenues increased from $4.76 million in 2010 to $8.71 million in 2012. For 2014, the revenue growth is estimated at 57.2% to $24.4 million, according to Thomson Financial.
Voxeljet has been in the red, but it is predicted to make $0.01 per diluted share in 2013 and $0.09 per diluted share in 2014, according to the Thomson Financial estimates.
For Voxeljet, it’s all about the future, when 3D printers become a mainstay in the homes of everyday users, based on my stock analysis.
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