3D Systems Corporation (DDD - Free Report) is slated to report first-quarter 2017 earnings, before the opening bell on May 3.
3D Systems has an impressive earnings surprise history, having posted three massive beats over the trailing four quarters. Last quarter, it surpassed estimates by 50%.
Let's see how things are shaping up for this announcement.
Factors to Consider
Over the past couple of quarters, 3D Systems’ healthcare business has proved to be its strongest profit churner. Healthy demand for printers and materials for medical and dental customers has been fuelling growth of this segment. These trends are expected to supplement top-line growth of the soon-to-be-reported quarter. In a bid to fortify its healthcare offerings during the first-quarter, 3D Systems expanded its Virtual Surgical Planning service and rolled out the revolutionary Figure 4 platform.
Further, it announced the acquisition of dental materials provider, Vertex-Global Holding B.V., which operates under the Vertex and NextDent brands. This apart, 3D System’s first-quarter 2017 top line is expected to benefit from robust demand for production printers, materials and software. Of late, the company has witnessed impressive recovery in production solutions and metals business. This is expected to drive the upcoming results.
Over the past year, 3D Systems has been making concerted efforts to improve it quality, reliability and supply chain and has made significant progress. It has improved the cost structure by focusing on IT infrastructure, go-to-market and innovation, and re-invested these savings back into key areas. We believe these diligent restructuring efforts will likely boost first-quarter profitability.
Despite these positives, 3D Systems broader market concerns have thwarted growth of the premium 3D printing company. The industry is battling a widespread decline in demand for enterprise 3D printers over the past two years. Other headwinds, including economic slowdown, inflation, currency fluctuations and commodity prices vagaries, have also marred the performance of most players in the industry.
In addition, the company’s escalating research and development costs, and higher expenses related to IT and go-to-market initiatives may play a spoilsport for the operating income performance. Moreover, intensifying competition in the industry, rapid technological changes, and alterations in customer requirements and preferences pose as concerns for the upcoming results.
Earnings Whisper
Our proven model does not conclusively show that 3D Systems will beat earnings estimates in this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.
Zacks ESP: Earnings ESP for the company is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate currently stand at 7 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: 3D Systems has a Zacks Rank #2. Though Zacks Rank #1, 2 and 3 increase the predictive power of the ESP, the company’s ESP of 0.00% makes surprise prediction difficult.
Note that we caution against stocks with Zacks Rank #4 or 5 (Sell-rated) going into an earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks that Warrant a Look
Here are some companies that you may want to consider, as our model shows that these also have the right combination of elements to post an earnings beat this quarter:
eGain Corp. (EGAN - Free Report) has an Earnings ESP of +50.00% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
AMETEK, Inc. (AME - Free Report) has an Earnings ESP of +1.79% and a Zacks Rank #2.
DragonWave Inc. has an Earnings ESP of +8.82% and a Zacks Rank #2.
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
3D Systems Corporation (DDD - Free Report) is slated to report first-quarter 2017 earnings, before the opening bell on May 3.
3D Systems has an impressive earnings surprise history, having posted three massive beats over the trailing four quarters. Last quarter, it surpassed estimates by 50%.
Let's see how things are shaping up for this announcement.
Factors to Consider
Over the past couple of quarters, 3D Systems’ healthcare business has proved to be its strongest profit churner. Healthy demand for printers and materials for medical and dental customers has been fuelling growth of this segment. These trends are expected to supplement top-line growth of the soon-to-be-reported quarter. In a bid to fortify its healthcare offerings during the first-quarter, 3D Systems expanded its Virtual Surgical Planning service and rolled out the revolutionary Figure 4 platform.
Further, it announced the acquisition of dental materials provider, Vertex-Global Holding B.V., which operates under the Vertex and NextDent brands. This apart, 3D System’s first-quarter 2017 top line is expected to benefit from robust demand for production printers, materials and software. Of late, the company has witnessed impressive recovery in production solutions and metals business. This is expected to drive the upcoming results.
Over the past year, 3D Systems has been making concerted efforts to improve it quality, reliability and supply chain and has made significant progress. It has improved the cost structure by focusing on IT infrastructure, go-to-market and innovation, and re-invested these savings back into key areas. We believe these diligent restructuring efforts will likely boost first-quarter profitability.
Despite these positives, 3D Systems broader market concerns have thwarted growth of the premium 3D printing company. The industry is battling a widespread decline in demand for enterprise 3D printers over the past two years. Other headwinds, including economic slowdown, inflation, currency fluctuations and commodity prices vagaries, have also marred the performance of most players in the industry.
In addition, the company’s escalating research and development costs, and higher expenses related to IT and go-to-market initiatives may play a spoilsport for the operating income performance. Moreover, intensifying competition in the industry, rapid technological changes, and alterations in customer requirements and preferences pose as concerns for the upcoming results.
Earnings Whisper
Our proven model does not conclusively show that 3D Systems will beat earnings estimates in this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.
Zacks ESP: Earnings ESP for the company is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate currently stand at 7 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: 3D Systems has a Zacks Rank #2. Though Zacks Rank #1, 2 and 3 increase the predictive power of the ESP, the company’s ESP of 0.00% makes surprise prediction difficult.
Note that we caution against stocks with Zacks Rank #4 or 5 (Sell-rated) going into an earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks that Warrant a Look
Here are some companies that you may want to consider, as our model shows that these also have the right combination of elements to post an earnings beat this quarter:
eGain Corp. (EGAN - Free Report) has an Earnings ESP of +50.00% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
AMETEK, Inc. (AME - Free Report) has an Earnings ESP of +1.79% and a Zacks Rank #2.
DragonWave Inc. has an Earnings ESP of +8.82% and a Zacks Rank #2.
Sell These Stocks. Now.
Just released, today's 220 Zacks Rank #5 Strong Sells demand urgent attention. If any are lurking in your portfolio or Watch List, they should be removed immediately. These are sinister companies because many appear to be sound investments. However, from 1988 through 2016, stocks from our Strong Sell list have actually performed 6X worse than the S&P 500.
See today's Zacks "Strong Sells" absolutely free >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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