Skip to Content
Morningstar

3D Systems Signals Renewed Revenue, Earnings Growth

The firm is making steady headway in certain high-value sectors and continues to commercialize new printers, materials, and related products.

Leading 3-D printer

We maintained our fair value estimate of $16, a still-modest valuation that reflects mainly signs of revenue stability and greater clarity for cash expenses and operating cash flow. The firm is making steady headway in certain high-value sectors, including the broader healthcare vertical and in direct metal parts printing. It also continues to commercialize new printers, materials, and related products--steps we deem essential to maintain competitiveness in a fast-evolving industry.

Management resumed providing financial guidance, a first since well before Joshi became CEO. Revenue guidance for 2017 of $643 million-$684 million suggests full-year growth of between 2% and 8%, while adjusted EPS guidance of $0.51-$0.55 compares with $0.46 in 2016. We forecast 3% revenue growth in 2017 to $650 million, mainly due to soft printer sales created by the approaching launch of HP's Multi Jet Fusion printers. We forecast mid-to-high single-digit growth in materials and software demand plus slightly higher Quickparts (on-demand parts) sales.

Quarterly results included signs of enhanced focus and efficiency, if not broad-based growth. Revenues of $166 million declined 10% year over year and rose 6% sequentially. Printer sales fell 21% (including lower professional and now-discontinued consumer sales), and on-demand parts sales fell 18%. Sales of high-margin consumables and software rose 4% and 12%, respectively.

Morningstar Premium Members gain exclusive access to our full analyst reports, including fair value estimates, bull and bear breakdowns, and risk analyses. Not a Premium Member? Get this and other reports immediately when you try Morningstar Premium free for 14 days.

More in Stocks

About the Author

David Silver

Senior Equity Analyst

David Silver, CFA, CPA, is a senior equity analyst for Morningstar Research Services LLC, a wholly owned subsidiary of Morningstar, Inc. He covers diversified industrials, including producers of industrial gases, engineering and construction services, electronic materials, pumps and valves, and professional staffing.

Before joining Morningstar in 2014, Silver spent approximately 20 years covering the chemicals sector as a sell-side analyst for Merrill Lynch, J.P. Morgan Securities, Credit Suisse, and Wertheim Schroder.

Silver holds a bachelor’s degree in accounting and finance from The Wharton School of the University of Pennsylvania and a master’s degree in business administration, with a major in finance, from the University of Chicago Booth School of Business. He also holds the Chartered Financial Analyst® designation and is a Certified Public Accountant.

Sponsor Center