3D Systems Faces Persistent Revenue Challenges Despite Restructuring and Asset Sale, Justifying Hold Rating

William Blair analyst Brian Drab has maintained their neutral stance on DDD stock, giving a Hold rating today.

Brian Drab has given his Hold rating due to a combination of factors impacting 3D Systems. The company is navigating a challenging environment, as evidenced by a significant decline in share value following its first-quarter report. Despite ongoing restructuring efforts, the company has faced a year-over-year revenue decline for 14 consecutive quarters, with adjusted EBITDA remaining negative. This is compounded by a decline in materials revenue, although there has been some growth in printer and service revenue.
Moreover, the company’s industrial and healthcare segments have also seen revenue declines, with healthcare being particularly affected by a major customer’s shift in inventory management strategy. While there are some positive developments, such as increased personalized healthcare revenue and significant cost-saving measures, these have not been sufficient to offset the broader challenges. The recent sale of the Geomagic asset portfolio has strengthened the balance sheet, but the overall outlook remains cautious, justifying the Hold rating.

According to TipRanks, Drab is a 5-star analyst with an average return of 18.9% and a 68.25% success rate. Drab covers the Industrials sector, focusing on stocks such as Xometry, Lindsay, and Valmont.