3D Systems (DDD) Short Traders Should Watch Out, Thinks Brean
Brean Capital today maintained a Buy rating on 3D Systems (NYSE: DDD) with a price target of $60.00. Analyst Ananda Baruah is enthusiastic about organic revenue growth and printer placements. He also thinks the stock is ripe for a short squeeze.
"Printers and Other Products revenue 'hit the cover off the ball' rising 108% Y/Y as the company attributed the solid growth to recent product introductions (“New Products Revenue +80% Y/Y), increasing reseller relationships, and general demand for professional printers (in particular, the ProJet x60 series) and the consumer line (i.e. Cube)," said Baruah.
"Jun Q Gross Margins of 51.9% came in below Street of 53.3% - primarily a result of the mix shift from the stronger Printer growth. However, we believe the Printer heavy Jun Q effectively acts as a down-payment on future revenue and margin expansion- vis-à-vis anticipated Materials and Services sell-through into the growing install base," he added.
Brean continues to view DDD as attractive at these levels given organic revenue growth and gross margin expansion. Baruah noted that 3D Systems has short interest of close to 30%. In his view, this may work in the stock's favor, as it could be prone to short covering.
For an analyst ratings summary and ratings history on 3D Systems click here. For more ratings news on 3D Systems click here.
Shares of 3D Systems closed at $48.16 yesterday, with a 52 week range of $27.88-$71.98.
"Printers and Other Products revenue 'hit the cover off the ball' rising 108% Y/Y as the company attributed the solid growth to recent product introductions (“New Products Revenue +80% Y/Y), increasing reseller relationships, and general demand for professional printers (in particular, the ProJet x60 series) and the consumer line (i.e. Cube)," said Baruah.
"Jun Q Gross Margins of 51.9% came in below Street of 53.3% - primarily a result of the mix shift from the stronger Printer growth. However, we believe the Printer heavy Jun Q effectively acts as a down-payment on future revenue and margin expansion- vis-à-vis anticipated Materials and Services sell-through into the growing install base," he added.
Brean continues to view DDD as attractive at these levels given organic revenue growth and gross margin expansion. Baruah noted that 3D Systems has short interest of close to 30%. In his view, this may work in the stock's favor, as it could be prone to short covering.
For an analyst ratings summary and ratings history on 3D Systems click here. For more ratings news on 3D Systems click here.
Shares of 3D Systems closed at $48.16 yesterday, with a 52 week range of $27.88-$71.98.