3D Systems Corp.
) is set to report second-quarter 2014 results on Jul 31 before the
opening bell. Last quarter, it posted a negative surprise of 8.3%.
Let's see how things are shaping up for this announcement.
Growth Factors in the Past Quarter
3D Systems, a bellwether in the 3D printing industry, had been
on a downhill since the beginning of this year owing to the
prevalent sluggishness in the industry.
3D printing is a relatively new concept, which will likely take
time to become popular. Furthermore, the industry is highly
dependent on patented technologies, which play an important role in
determining a company's performance.
As such, the company is focused on investing in research and
development (R&D) for sustainable long-term growth. In the
quarter, the company unveiled a number of innovating offerings like
the novel iSense 3D Scanner, its high speed racetrack 3D printer
and 3D Printed Bespoke Braces among others.
3D Systems remains focused on broadening its presence in
materials, medical and metal industries, as suggested by its
capital allocation strategies. The company recently raised its
earnings and revenues guidance for 2014 after having completed the
acquisition of Medical Modeling. The pending Robtec acquisition is
also a positive for the long run.
The 3D printing market presents a favorable long-term
opportunity as a large number of engineers, designers, architects
and entrepreneurs are opting for 3D solutions for their primary
designing and product modeling. However, high R&D expenditures
along with increasing marketing expenses are likely to weigh upon
the bottom line.
Our proven model does not conclusively show that 3D Systems is
likely to beat earnings this quarter. This is because a stock needs
to have both a positive Earnings ESP and a Zacks Rank of #1, 2 or 3
for this to happen. This is not the case here, as you will see
: Earnings ESP for 3D Systems is 0.0%. This is because both
the Most Accurate estimate and the Zacks Consensus Estimate stand
at 14 cents.
Zacks Rank #3 (Hold)
: 3D Systems carries a Zacks Rank #3 (Hold). Though a favorable
Zacks Rank increases the predictive power of ESP, the company's ESP
of 0.00% makes surprise prediction difficult. We caution against
stocks with Zacks #4 and 5 Ranks (Sell-rated stocks) going into the
earnings announcement, especially when the company is witnessing
negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post an
earnings beat this quarter:
Arch Capital Group Ltd. (
), with Earnings ESP of +3.03% and a Zacks Rank #2 (Buy).
Infosys Ltd. (
), with Earnings ESP of +1.24% and a Zacks Rank #2.
Archer Daniels Midland Co. (
) has an Earnings ESP of +5.26% and a Zacks Rank #2 (Buy).
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3D SYSTEMS CORP (DDD): Free Stock Analysis
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