Analyst: 3D Systems Is Making The Right Moves

3D Systems Corporation (NYSE: DDD)'s earnings report was "choppy" but the 20-percent plunge in the stock doesn't mean the company's prospects and outlook are doomed, at least according to Loop Capital Markets' Ananda Baruah. The analyst maintains a Hold rating on 3D Systems' stock with an unchanged $15 price target.

3D Systems' earnings report did show the company is positioning itself to grow revenue, generate healthy returns and catalyze 3D Printing (3DP) use within the production market, the analyst explained. In addition, the company believes it's well positioned to gain a 10 to 20 percent share of the Medical device market, which is worth $30 to $40 billion. This would represent "significant dollars" for the company at a time when the competitive landscape is limited with only 50 medical device companies.

Meanwhile, 3D Systems' strategy is looking to establish itself as a "production focused customer centric ecosystem" with an optimized installed base and a software and services model, the analyst continued. CEO VJ Joshi boasts the necessary expertise and leadership skills that will result in future success.

However, it will take a long time for the company to realize success as the prior 10 quarters has consistently reported revenue in the range of $151 million to $183 million. As such, investors may need to wait for a catalyst to boost the stock and this will occur when revenues (or margins) can sustainably move above the established range.

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