Seeking Alpha’s analysis appears to have created a self-fulfilling prophecy: On January 28, 2013, 3D Systems and Stratasys stocks fell 14% and 10% respectively. One day later they rebounded by 5% and 3%.
I agree with Seeking Alpha’s questioning, “Considering the ambiguity of the industry, was this growth really justified.” However, I arrive at it from a different angle. I’m not an investor; I’m not a financial guy; and I’m not qualified to comment from that position. Rather, my opinion comes from the practical observations of those that participate in the 3D printing industry and have done so prior to the tsunami of interest in the field.
I recently read an article (source unknown) that noted the dichotomy between those that report on 3D printing and those that practice it. That author got it right. Conversations with my peers, associates and colleagues reveal that there is a gold-rush mentality, a gold 3D printing fever, that has the newly aware rushing to get in on the action. Many are rushing to stake a claim in the promised-to-be revolution.
My associates and I agree that 3D printing is long overdue for recognition of its capabilities and adoption of its technologies. We all agree that the market exuberance is great for business. Yet, we also believe that the interest is over the top and not sustainable at this fever pitch.
Yes, 3D printing is here to stay, and yes, it will experience strong, attractive growth over the coming years. But, this bubble of excitement will pass.
My thoughts turn to a recent commentary on Apple stock (I apologize to the commentator since I cannot remember who said it). He stated his opinion that its stock price has been and will be driven by emotion. Driving the stock up is the desire to not miss out on the next big thing. The fear of being caught in a downslide drives prices down. 3D printing is like Apple on the upside. This is true of stock prices as well as merger, acquisition and startup activities.
As with the California gold rush, there will be (and have been) some that strike it rich: investors, corporations and startups. On the other hand, when the “gold” runs out, there will be some that leave with empty pans and unmet dreams.
This commentary doesn't constitute individualized investment advice. The opinions offered herein aren't personalized recommendations to buy, sell or hold securities.
Image credit: Digitas Photos (@Flickr.com)