The 3D printing tech sector is perfectly primed to generate buzz. It has a catchy name, a concept that seems straight out of a science fiction novel, and a well-oiled hype machine. And that hype goes all the way to the top. In February, President Obama addressed the wild possiblities of 3D priting tech directly, saying 3D printing “has the potential to revolutionize the way we make almost anything."
And that's certainly what the tech promises. 3D printing, taken to its logical perfection, works like the replicator in Star Trek: it prints objects. Prints them, like a trip to Kinko's. Tangible objects manufactured easily, quickly, and on demand.
And to a degree, that is exactly what 3D priting does, even at this early stage in development. Through a repetitive bonding process that utilizes powderized plastic, a 3D printer could make about anything: cool-looking casts, figurines, jet engines – even guns.
Sounds exciting, and the usefulness of such a device is immediately tangible. Four 3D printing companies have gone public, capitalizing on the hype of the nascent technology. The smallest in terms of market cap, ExOne Co. (XONE) had their IPO in Feb. 2013. This follows the debuts of rival 3D printing companies 3D Systems Corp (DDD), Stratasys, Ltd. (SSYS), and Proto Labs Inc. (PRLB).
And investors are ecstatic about the possibilities. ExOne is up a staggering 83.5 percent since its IPO, hitting $61.75 on June 28. SYSS has been a little more modest, up only 4.48 percent YTD, though their stock gained 170.74 percent in 2012, and forecasts continue to be bullish. Proto Labs, which had its IPO in Feb. 2012 and is up 64.81 percent YTD. And the oldest public 3D printing company, 3D Systems, is (only) up 20.37 this year— but has gained an insane 1207.84 percent since 2008.
It’s not a stretch to call 3D printing tech one of the hottest sectors in the tech market. But when one starts to scratch the surface of the product, it looks like 3D printing still has a lot to prove. And the meteoric rise of these four stocks has brought out that most unfortunate word in meteoric rises.
Because for all the promises of 3D printing, from President Obama, from its investors and the company CEOs, the tech is still in its infant stage. The discrepancy between public perception of how far along 3D printing is and and the reality of it is wide.
In Feb. California analytical firm Citron Research issued a report singling out 3D Systems' Chief Executive Abe Reichental, a vocal cheerleader of the tech. Citron wrote, "Appearances have become completely unhinged from reality when it comes to the mania created in so-called '3D Printing' stocks, and 3D Systems in particular.”
Industry insiders are calling for restrain as well. I may the founder of 3D Printing UK Nick Allen warned that the tech was not nearly as close to Star Trek-style replication as the media had purported it be. Allen also cited the high cost of 3D printing and warned that at this point, the tech is impractical for really producing anything on a commercial level. The tech has amazing possibilities, but as he says, we are still in the “honeymoon” stage.
Right now, one of the only 3D printers available on the market is 3D Systems Cube 3D printer, priced at $1,299. 3D Systems currently has a 84.42 P/E ratio, and their earnings report is slated for July 25. It will become appernt then if the public is buying up 3D printing tech at the level to sustain their growth (punch section.)
The future for 3D priting, as conceptualized by its insiders, is awesome indeed. The idea that one could take a printer, and use it to assemble products, turing their office into a miniature factory, is truly groundbreaking. Riechental prophesized that “(3D printing) will become the canvas to create and make, to make virtual into actual and to unleash every persons creativity.”
But as Allen mentions in his article, we’re nowhere near such a seamless transition from thought to the real yet. The current tech just isn’t nearly that refined. As is now, 3D printed objects are flimsy and expensive. Impressive looking products are actually no more than pricey, interesting curios. And while the fascination with 3D printing as a curio is wholly apparent, its ability to outlive its status as a sci-fi fad, and turn into a tech capable of sustaining its current boom, is uncertain.
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