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Why Is Stratasys (SSYS) Up 29.1% Since Last Earnings Report?

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It has been about a month since the last earnings report for Stratasys (SSYS - Free Report) . Shares have added about 29.1% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Stratasys due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Stratasys Reports Wider-Than-Expected Loss in Q3

Stratasys reported non-GAAP loss of 5 cents per share in the third quarter, wider than the Zacks Consensus Estimate of a loss of 4 cents. Moreover, the company had recorded earnings per share of 12 cents per share in the year-ago quarter.

Stratasys’ revenues of $127.9 million also declined 18.8% year over year. The revenue figure, however, surpassed the consensus mark of $122.5 million. This year-over-year decline in the top line reflects the adverse impact of the COVID-19 pandemic which has dampened the demand for its products and services.

Quarter Details

Segment wise, Product revenues were down 21.4% from the year-ago quarter to $83.5 million. Within Product revenues, System revenues decreased 20.8% and Consumables revenues fell 22% year over year.

Revenues from Services decreased 13.2% year over year to $44.3 million. Within Service revenues, customer support revenues dropped 1.6% year over year.

Stratasys’ non-GAAP gross profit dipped 22.7% from the year-ago quarter to $59.8 million. Non-GAAP gross margin contracted 560 basis points (bps) to 46.8%.

Non-GAAP operating expenses slid 18.3% year over year to $60.8 million, on management’s efforts to cut SG&A costs.

Non-GAAP operating loss totaled $1 million against the operating income of $8.1 million recorded in the prior-year quarter.

The company exited the third quarter with cash and cash equivalents of $308 million compared with the $313 million witnessed at the end of the previous quarter.

As of Sep 30, 2020, there was no long-term debt.

During the July-September quarter, the company generated operating cash flow of $2.6 million.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates have trended downward during the past month.

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