3-D Printing Drop Following ExOne Miss, May Be A Buying Opportunity

3-D printing stocks are trading lower again in sympathy after ExOne (NASDAQ: XONE) reported downbeat fourth quarter results and issued a weak 2014 revenue outlook on Wednesday afternoon. Brean Capital sees the sector weakness as a sector buying opportunity and RBC had some bullish comments on the sector as a whole.

Ananda Baruah, analyst at Brean, said the ExOne miss is “not related to underlying demand characteristics for DDD, SSYS.” ExOne's miss was due mostly to a “delay in order for higher-end Sand core/mold units.”

The Brean analyst also believes ExOne's metals offering is “gaining traction,” which is positive for 3D Systems (NASDAQ: DDD).

In the RBC note, analyst Amit Daryanani said the 3-D printing market should grow at “~24% CAGR from 2013-2021 to become a $15b industry, fueled by lower average selling prices, increased ability to manufacture production-grade parts.”

Some investors are fearful that Hewlett-Packard's entry into the 3-D printing space will be negative for established players, but Daryanani disagrees.

Daryanani believes Hewlett-Packard's entry into the sector should “support 3D Systems, Stratasys near term as it validates viability of technology.” Daryanani expects “HPQ to focus on enterprise/industrial segment, leveraging its existing printing-head technology.”

Shares of ExOne, 3D Systems, and Stratasys (NASDAQ: SSYS) are down 9.5, 2.6, and 0.9 percent respectively, while shares of Hewlett-Packard are up 2.5 percent.