Has Stratasys Hit Rock Bottom?

Stratasys Inc. (SSYS) Information Technology – Computers & Peripherals | Reports March 3, Before Market Opens

Key Takeaways

The Estimize community is calling for EPS of -$0.09 and revenue of $167.27 million, 2 cents higher than the Street on the bottom line, and roughly $2 million greater on the top line

Stratasys’ recent setbacks come as demand for 3D printers have waned

The company is witnessing unfavorable YoY growth from softer markets and volatile economic conditions around the world

What are you expecting for SSYS? Get your estimate in here!

3D printer company, Stratasys, is scheduled to report fourth quarter earnings tomorrow, before the opening bell. The company is coming off a weak third quarter, where it missed on both the top and bottom line. Moreover, year over year growth has been unfavorable from softer markets and volatile economic conditions around the world. Many customers have delayed purchasing a 3D printer pointing to the exorbitant price tags of these systems.

This quarter, the Estimize community is calling for EPS of -$0.09 and revenue of $167.27 million, 2 cents higher than the Street on the bottom line, and roughly $2 million greater on the top line. However our Select Consensus, which heavily weight historically accurate analysts and recent estimates, is showing a more modest beat of 1 cent. Since November 2015, the Estimize community has been bearish on Stratasys’ profitability, revising EPS estimates down 89%. Compared to the same period last year, current estimates predict a YoY decline in EPS and revenue of 117% and 23%, respectively.

Once expected to be the next big thing, Stratasys and all the other 3D printing companies had another disappointing year in 2015. After losing 38% of its value in 2014, Stratasys managed to out do itself in 2015, watching shares fall an additional 71%. Negative FX headwinds have been the main scapegoat for missed earnings expectations throughout the year. This in itself has effectively hampered capital investments, as well as performance of its MakerBot business. In Q3, Stratasys reported a 55% YoY revenue decline in its MakerBot business, pressuring margins as the overall popularity of 3D printing has waned. Additionally, higher operating costs from increased investments have led investors to question the company’s long term profitability. As of Q3 2015, the company has no debt, allowing Stratesys to focus on improving its products, specifically 3D printing.