While all of these companies have their niche, they all operate in the 3D printing space. Let’s see how they compare.
| 3D Systems | Stratasys | ExOne | |
|---|---|---|---|
| Market Cap | $4.5 billion | $3.4 billion | $830 million |
| Trailing P/E Ratio | 108 | N/A | N/A |
| Forward P/E Ratio | 36.5 | 34.7 | $100 million |
| Price/Sales | 12.0 | 13.35 | 26 |
| Operating Margin | 19% | 2.9% | (24.5%) |
| Return On Equity | 9.7% | (1.27%) | N/A |
| Revenue Growth MRQ | 45% | 116% | 191.5% |
First off, let’s remove the monkey from the room, and address ExOne Co (NASDAQ:XONE), because although in the 3D printing space, it does not compare to Stratasys, Ltd. (NASDAQ:SSYS) and 3D Systems Corporation (NYSE:DDD). At this point, it is way too early to judge ExOne’s upside, as five devices sold last quarter does not give us an indication of long-term performance. We need to see ExOne Co (NASDAQ:XONE) consistently rise in printers sold, and maybe in a few years, we’ll be able to compare it better to its larger peers. As of this moment, 26 times sales looks to be quite pricey.
Now, like I said, 3D Systems’ quarter was great, but as I look at it and Stratasys, I can’t help but to think that 3D Systems Corporation (NYSE:DDD) is running in second place. Stratasys, Ltd. (NASDAQ:SSYS) has now entered the consumer business, and is soon-to-be the most diverse of any 3D printing company. In terms of valuation, Stratasys’ price/sales is only slightly higher, but its growth is more robust. Furthermore, with operating margins of 2.9%, Stratasys, Ltd. (NASDAQ:SSYS) has the potential to significantly expand its margins. Therefore, looking ahead, I believe that Stratasys is the best investment choice.
Final Thoughts
There aren’t too many industries that I’d buy at 12-15 times sales, but 3D printing is one of them. The printing space including consumer, commercial, and industrial is massive, and 3D printing has the technology to do something that HP could never accomplish, and that’s print actual products with the use of different materials. Hence, long-term 3D printing saves consumers and businesses money, which is why I think it will thrive, and that these stocks are worthy of their premiums.
The article Is There Still Upside in 3D Printing? originally appeared on Fool.com and is written by Brian Nichols.
Brian Nichols has no position in any stocks mentioned. The Motley Fool recommends 3D Systems, ExOne, and Stratasys. The Motley Fool owns shares of 3D Systems and Stratasys and has the following options: short January 2014 $36 calls on 3D Systems and short January 2014 $20 puts on 3D Systems. Brian is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.
