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Investing in 3D Systems Corp (NYSE: DDD)

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Investing in 3D Systems Corp (NYSE: DDD)

3D Systems Corp (NYSE: DDD) is one of the oldest and most established companies in the 3D printing sector. Often referring to themselves as “the first 3D printing company in the world”, 3D Systems Corp has over three decades of experience in the additive manufacturing industry. In this time, the company has rapidly expanded its service offerings and through investments in research and innovation, are well poised to continue this expansion well into the future.

What is 3D Systems Corp (DDD)?

3D System Corp co-founder Chuck Hull is most notable for inventing the stereolithography method of 3D printing. Patented by Hull in 1984, Stereolithography (also known as SLA printing) is the earliest and most widely adopted 3D printing technology. The SLA method creates 3D printed objects through printing thin layers of an object using a vat of liquid photopolymer, starting from the bottom layer and working up to the top. For this invention, Hull is often referred to as the father of 3D printing.

With this technology in hand, Hull founded 3D Systems Corp in 1986. With Hull still remaining on as the companies CTO,  3D Systems Corp has now grown to over 2600 employees with offices around the world. The company has rapidly expanded and added to its service offerings. In addition to stereolithography, 3D Systems Corp has pioneered the development of several additional technologies. The company and its products are now used to manufacture products using selective laser sintering, multi-jet printing, film-transfer imaging, color jet printing, direct metal printing, and plastic jet printing.

Why does 3D Systems Corp (DDD) Matter?

The company has three separate and distinct business lines. Firstly, the company offers hardware and software products. 3D printers and associated software can be purchased and used in the manufacturing process by companies looking to 3D print in-house. The company offers over 10 different 3D printer models to meet a variety of needs. From hobbyists to professionals, printers at various price points are available to meet the needs of everyone. On these powerful machines, 3D Systems software such as Geomagic can be run to take real-world physical items and reverse engineer them so that they can be blueprinted and mass-produced using 3D printing. Secondly, for those who wish to do their own production, the company sells the raw materials needed for 3D printing. Examples include plastic, elastomer, composite, wax, and metal. The company offers consultations for those who may need advice in choosing products. Factors to consider include price, durability, flexibility, as well as the look and feel. Finally, for those who do not have printers or materials, 3D Systems offers on-demand manufacturing for a variety of different needs. This service includes every step of the manufacturing process, from prototyping to printing physical products, and can take as little as 24 hours.

One thing that makes 3D Systems unique is its closed-system approach to product development. Through patents, the company protects products and only uses in-house technologies on their printers. While this approach has been criticized by some as stifling innovation within the industry, the company’s response is that it has been able to increase internal incentive structures and invest more money into research and development, leading to better products for consumers. Through this approach, 3D Systems holds over 1000 patents, which allows it to maintain a competitive edge over other companies in the sector. As noted before, company co-founder and current CTO Chuck Hull has committed much of his life work to inventing new 3D printing technologies, and as a result was inducted into the National Inventors Hall of Fame in 2014.

3D Systems Corp (DDD) Prospects

Their current customer base is focused broadly on two high-value market verticals: the healthcare sector and the industrial sector. In the healthcare sector, precision healthcare solutions are offered to meet a variety of needs. Through an end-to-end service model, 3D Systems Corp helps to digitize, design, manufacture, and deliver products that can be used in medical simulators, surgical planning, anatomical modelling, and orthodontics to meet a variety of patient needs. These services have resulted in several medical innovations, allowing both experienced surgeons and trainees alike to practice their skills in risk-free environments.

On the industrial side, 3D Systems Corp services several high-value sectors. For example, through relationships in aerospace and defence, the company provides custom made solutions to a variety of industry partners. 3D Systems Corp was selected to work with NASA and produced parts such as wheels and camera mounts for the Mars Rover. In another example, through partnerships in the automotive industry, 3D Systems Corp works with manufacturers to produce lighter-weight, lower cost parts for customers around the world. From vintage cars to commercial trucks, the company has worked with a variety of customers to produce custom solutions. These are just two examples of sectors within the industrial market that the company operates in.

Through these two market verticals, the company has streamlined its operations and focused on marketplaces that offer the highest prospects for growth. Through decades of research and development, the company has created partnerships with some of the largest companies in their respective sectors and continues to be viewed as a well-respected partner.

Where to Buy 3D Systems Corp (DDD) Stocks

A broker that we recommend is Firstrade.

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Summary

3D Systems Corp is a company that has been constantly innovating over the past three decades. With a focus now on two specific markets (healthcare and industrial), the company has now built several strong relationships and is well-positioned to continue expanding into these two profitable markets. With a variety of business solutions, the addressable customer base is wide-ranging, from beginners looking to learn more about 3D printing to multi-million dollar companies looking to bring manufacturing costs down. While the 3D printing sector is undoubtedly a crowded space with many competitors, 3D Systems Corp holds several advantages over other companies, and these advantages are likely to allow for greater growth well into the future.

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Baggio has been an investor in the technology space for over half a decade. He uses the perspectives gained from his work experience in the private, public, and non-profit sectors to guide his investment strategy, with a specific interest in the potential of emerging disruptive technologies.