The banking giant was quick to give industry leader 3D Systems an “Over-perform” rating pegging the stock to a $62.00 price. The investment firm was also bullish on the other primary player, Stratasys.
Praise for the investment opportunities in the industry wasn’t universal, however. Credit Suisse analyst Julian Mitchell seems to think that the stock price was overheated for Exone, saying, “”We see three key downside risks to consensus sales growth assumptions: (1) uptake of the core technology is liable to be constrained by lack of CAD penetration in Asia (where XONE has higher exposure than peers); (2) there is a need for significant post processing in metals (unlike competing technologies); (3) revenues are highly cyclical, given full exposure to industrial markets and minimal materials ‘tail’ following a system sale.” Note that these comments speak to the stock price and not the actual technology of Exone.
Overall, Credit Suisse’s analysts see 3D printing as an industry ripe for growth. In fact, the bank concluded that the 3D printing industry is being severely undervalued by others. “Our proprietary 3D penetration analysis suggests consensus sales growth forecasts could prove conservative. Most corporate guidance defaults to the assumptions of industry consultants who estimate that the 3D printing market will grow at approximately 20% annually.”
What’s more, with strong growth in aerospace, automotive, healthcare and consumer markets 3D printing could “sustain 20-30% annual revenue growth” particularly if the industry invests in developing machines capable of producing durable, end use parts.