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3D Systems Corporation (DDD - Free Report) missed earnings back at the start of March and the stock has moved lower ever since. The question becomes if this stock has bottomed out here in the low $20 range or is it primed for a rebound? Let’s take a deeper look in this Bear of the Day article.
Description
3D Systems Corporation, through its subsidiaries, provides 3D printing and digital manufacturing solutions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company was founded in 1986 and is headquartered in Rock Hill, South Carolina.
Earnings History
The first thing I do when I look at stock is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has been able to communicate to the market. A stock that consistently beats is one that has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of DDD, I see two beats and two misses in the last year. Both misses were two cents below the estimate and both translated into a -18% earnings surprise. The beats were for 5 and 1 cent respectively, and the help smooth the average to a more palatable 11.5%.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For DDD, I see estimates moving lower across the board.
This quarter has moved from 5 cents to 3 cents.
Next quarter has seen a similar decrease from 7 cents to 4 cents.
The Zacks Rank is more heavily influenced by the move in the annual numbers, and the movement is also negative for those numbers.
I see 2021 moving from $0.34 to $0.25 over the last 60 days.
The 2022 number has moved from $0.44 to $0.36 over the same time horizon.
Negative movement in earnings estimates like that are the reason that this stock is a Zacks Rank #5 (Strong Sell).
Valuation
I am partial to growth, so when I see this stock posting 5% topline growth in the more recent quarter I want think that most of the bad news is baked into the stock. Next I see no topline growth expected for this quarter and I get a little worried. For the full year 2021, I see only 2.1% topline growth and that is really low. Then I see an 88x forward PE and that is hard to stomach for such low growth rate. The price to book is much more reasonable at 6.4x compared to a 22x industry average. Finally a price to sales multiple of 4.8x compared to a 5.5x industry average is good, but still a little high.
At the end of the day, I would want to see the growth prospects return for DDD before I take a deeper look at this stock again.
Chart
3D Systems Corporation Price, Consensus and EPS Surprise
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Bear Of The Day: 3D Systems Corporation (DDD)
3D Systems Corporation (DDD - Free Report) missed earnings back at the start of March and the stock has moved lower ever since. The question becomes if this stock has bottomed out here in the low $20 range or is it primed for a rebound? Let’s take a deeper look in this Bear of the Day article.
Description
3D Systems Corporation, through its subsidiaries, provides 3D printing and digital manufacturing solutions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company was founded in 1986 and is headquartered in Rock Hill, South Carolina.
Earnings History
The first thing I do when I look at stock is look to see if the company is beating the number. This tells me right away where the market’s expectations have been for the company and how management has been able to communicate to the market. A stock that consistently beats is one that has management communicating expectations to Wall Street that can be achieved. That is what you want to see.
In the case of DDD, I see two beats and two misses in the last year. Both misses were two cents below the estimate and both translated into a -18% earnings surprise. The beats were for 5 and 1 cent respectively, and the help smooth the average to a more palatable 11.5%.
Earnings Estimates
The Zacks Rank tells us which stocks are seeing earnings estimates move higher or in this case lower. For DDD, I see estimates moving lower across the board.
This quarter has moved from 5 cents to 3 cents.
Next quarter has seen a similar decrease from 7 cents to 4 cents.
The Zacks Rank is more heavily influenced by the move in the annual numbers, and the movement is also negative for those numbers.
I see 2021 moving from $0.34 to $0.25 over the last 60 days.
The 2022 number has moved from $0.44 to $0.36 over the same time horizon.
Negative movement in earnings estimates like that are the reason that this stock is a Zacks Rank #5 (Strong Sell).
Valuation
I am partial to growth, so when I see this stock posting 5% topline growth in the more recent quarter I want think that most of the bad news is baked into the stock. Next I see no topline growth expected for this quarter and I get a little worried. For the full year 2021, I see only 2.1% topline growth and that is really low. Then I see an 88x forward PE and that is hard to stomach for such low growth rate. The price to book is much more reasonable at 6.4x compared to a 22x industry average. Finally a price to sales multiple of 4.8x compared to a 5.5x industry average is good, but still a little high.
At the end of the day, I would want to see the growth prospects return for DDD before I take a deeper look at this stock again.
Chart
3D Systems Corporation Price, Consensus and EPS Surprise
3D Systems Corporation price-consensus-eps-surprise-chart | 3D Systems Corporation Quote
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In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.
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