At one point, 3D printing stocks were all the rage amongst investors looking for the next big technology wave.
In 2018, 3D printing stocks beat the overall market and were set to outperform in 2019. This marked a turnaround of sorts, after the sector had slumped following a huge price run-up in 2012 and 2013.
However, 2020 saw more volatility creep into the space as two of 3D printing’s biggest names saw major declines. 3D Systems ($DDD) and Stratasys ($SSYS) both dropped in the first quarter of the year, with 3D Systems in particular now trading in penny stock territory.
But using moves like these to write off the entire group would be a mistake.
Global appetite for 3D printed products continues to grow and is expected to reach $40 billion in 2024, a compound annual growth rate of over 26 percent, according to data from Statista.
In fact, two lesser-known companies have skyrocketed in the first half of 2020, both outperforming since their initial public offerings (IPOs). Materialise ($MTLS) and Proto Labs ($PRLB) each went public in 2014 and 2012, respectively.
But for new investors just looking to get into 3D printing space, those prices may be a little too high. Fortunately, there are a number of 3D printing penny stocks available to investors.
What Is 3D Printing?
Of course, before making any investments, it’s paramount to conduct your research. While we don’t purport to be able to offer the same sort of insight that proper company disclosures or white papers can provide, we’ll do our best to give you an overview of the space.
To begin with, you may also hear these stocks referred to as additive manufacturing stocks. These terms are synonymous. Many people view 3D printing as a tool that has the potential to change the world – it can change the way products are developed, built, bought, and acquired.
The Coronavirus pandemic in particular has driven interest in the space. Indeed, the technology is such an agile manufacturing technology that it can create a quick changeover of production lines, allowing for large manufacturers to pivot their assembly lines to more in-demand products.
As this Forbes article points out, we’ve seen 3D companies step up to rapidly produce personal protective equipment (PPE), nasopharyngeal (NP) testing swabs, and even emergency-use medical devices.
As a result, the industry has been drawing attention from investors, with a handful of 3D printing companies even raising millions of dollars in investment. (Additive Industries, Arevo, and Azul3D, in case you were curious.)
So there appears to be a lot of potential in the sector, especially in these trying times. But where do you begin if you’re a novice investor? Well, if you have a particularly high risk profile, penny stocks may be the option for you.
Here are our picks of top 3D printer companies stocks for October 2020.
1. Tinkerine ($TKSTF)
Canada’s Tinkerine currently trades on the over-the-counter (OTC) market, which should signify to any savvy investor that this is a penny stock and should be treated with the cautiousness that that requires.
However, there is a lot to like about Tinkerine.
For one, the firm is focused on the consumer and educational 3D printing markets. Its Ditto Pro 3D printer, filament, software, and accessories have generated positive reviews, receiving the best 3D Printing Product Award at CES Asia. The printer was also featured in MAKE Magazine's Annual 2015 Ultimate Guide to 3D Printing.
Founded on May 25, 2006 by Eugene Suyu and Justin Sy, the company sells its products throughout Canada, the United States, and the Asia Pacific region.
The firm had a particularly good year back in 2015, tripling its first-quarter revenue by the second quarter of the year. The company has seen a slump since then, so it remains to be seen whether the company will be able to capitalize on the current popularity of 3D technology.
At any rate, this is one 3D printing penny stock to keep an eye on.
2. Sigma Labs, Inc. ($SGLB)
Established in 2010 and headquartered in New Mexico, Sixma Labs trades on the OTC market.
The company sells “quality management systems” for additive manufacturing, which can assess the quality of a product in real-time, even as it’s being produced. Its cornerstone product is PrintRite3D, which was built for the aircraft manufacturing industry, specifically for parts that are built using additive manufacturing.
The company also boasts a 3D printing manufacturing product line, with a recently acquired state-of-the-art metal printer. If the company is able to drum up customers for its contract manufacturing services, the company should see even more revenue growth.
While Sigma Labs’ historical financial performance is a story of stagnant revenues and declining net income, the company made news as recently as August 2020 when its stock jumped nearly 50 percent.
The price jump followed news that Sigma Labs had been awarded a contract by Mitsubishi Heavy Industries to implement its PrintRite3D service.
Still, Sigma Labs hasn’t inspired much confidence from market experts and the stock remains viable - but if you’re looking for penny stock opportunities, that should be expected. We’ll see if Sigma can take advantage of the increased interest in the sector to raise its 3D print stock.
3. Nano Dimension ($NNDM)
This 3D printing penny stock drew attention earlier this year, seeing a surge in the second quarter of 2020.
That particular uptick followed news that Nano Dimension, along with another company named Hensoldt, had achieved “a major breakthrough on its way to utilizing 3D printing.” Of particular interest is Nano Dimension’s 3D printer, the DragonFly 2020, an accurate, versatile inkjet deposition system for creating professional multilayered circuit boards.
Hensoldt CEO Thomas Muller said at the time: “Military sensor solutions require performance and reliability levels far above those of commercial components. To have high-density components quickly available with reduced effort by means of 3D printing gives us a competitive edge in the development process of such high-end electronic systems.”
The news sent the stock from $1.24 to $4.89 in a mere two days before the expected pull-back took hold and the stock sunk back to $2.25.
Beyond the military implications of Nano Dimension’s proprietary offerings, the 3D printer itself has obvious benefits. For one, the DragonFly 2020 gives companies who use the tech the ability to keep their intellectual property in-house while working on prototypes. This speeds up research and development time by cutting out middleman manufacturers while saving these companies money.
With all of that on it’s side, it’s little wonder that Nano Dimension’s own President and CEO recently made a huge personal investment in the company. Time will tell if he was right, but if may be a good opportunity for investors to get in on the action.
4. Conformis ($CFMS)
This medical technology company currently has a market cap of $66 million.
While that’s a pretty far cry from the market cap of $173.8 million the medical technology company had back in 2019, there is potential for Conformis to turn around. As of June, at least four hedge funds were holding Conformis stock in their portfolio.
The biggest stake was held by Renaissance Technologies, which owned 5,029,207 shares valued at $4,124,000. Hedge fund investment can be a good indicator of general sentiment toward a company, and Renaissance has appeared relatively bullish on the stock.
Conformis manufactures customized knee and hip replacements made specifically for each patient which, with the world’s aging population, could be seen as a growth industry.
Headquartered in Billerica, Massachusetts, the firm uses 3D imaging technology alongside the most up-to-date manufacturing techniques to form implants that fit the unique size and shape needs of certain patients.
Conformis is seen as a highly innovative company built around the unique concept of customized, 3D printed medical implants, while the company’s products have proven successful in clinical trials compared to traditional implants.
Moreover, the medical device industry is booming. Many investors expect that companies with innovative technologies will see an increase in revenue in the coming years. Not to mention, the company should see benefits as the 3D printing sector continues to grow.
5. Boxlight Corporation ($BOXL)
Broadly speaking, Boxlight Corporation is an education company, but part of its solution base includes 3D printing alongside interactive digital software, robotics STEM-related assets, and certifications, among others.
Education, in general, has been undergoing big changes in recent years, while technology has proven a popular investment during COVID times. That puts EdTech companies like Boxlight squarely at the epicenter of two hot investment sectors.
Boxlight Corporation, which develops and services eLearning software for the classroom, is looking to establish itself as a named player in the growing sector.
In April 2020, the company invested approximately $600,000 to acquire Robo 3D, a leading brand of 3D printers, and MyStemKits, the largest online collection of K-12 STEM curriculum for 3D printing.
Michael Pope, CEO of Boxlight, said at the time: "3D printing is a foundational STEM technology that students of today can leverage in their future professions. We are now uniquely positioned to offer a comprehensive suite of STEM solutions, complete with our Labdisc portable STEM lab, Mimio Mybot robotics and coding solution, STEM specific training and professional development, and both the Robo 3D and MyStemKits branded 3D printing hardware and curriculum."
The investor gurus who are paying attention to the stock seem to like it. At least two analysts have given this 3D printing penny stock a BUY rating, while one analyst recommended HOLD, and zero analysts saying investors should sell the stock, according to Invest Chronicle.
6. Voxeljet AG ($VJET)
While voxeljet isn’t technically a penny stock - the price of this 3d printer company stock is slightly over the $5/share metric usually used to determine a penny stock - we’re going to include it anyway.
Mostly because for much of its life, the company has traded below the $5 mark, and at it’s current rate it’s still a cheap stock to buy.
Based in Germany, voxeljet makes industrial 3D printers for the Automotive and Aerospace industries. The company saw its biggest trading volume day in over a year at the end of March. However, due to a lack of any news or disclosures at the time, the spike was likely due to overall Coronavirus interest in 3D printing companies.
Indeed, the price has fallen since its March highs following a quarterly loss reported that prompted the firm to move its shares from the New York Stock Exchange (NYSE) to the NASDAQ to help mitigate some of the resulting turmoil. That move put voxeljet in rarefied territory: Since 2000, only 53 companies had switched their stock listings between the two exchanges.
Still, many analysts remain bullish on the stock, and while the price is low it could present an interesting opportunity for penny stock investors.
Conclusion
For the uninitiated, penny stocks are stocks that trade at a very low market price - generally below $5 per share. These stocks have low liquidity and are very speculative in nature.
Penny stocks typically don’t trade on the bigger exchanges like the NYSE or NASDAQ (though, there are exceptions, as noted above). Instead, investors buy these stocks on places like OTCBB and Pink Sheets.
But just because they don’t receive as much attention doesn’t mean they don’t have the potential for big returns and big drama. Indeed, they could offer some of the most stomach-churning opportunities available to young investors.
Penny stocks are, by their very nature, a risky proposition. If you have a low-risk profile, you may want to stay clear of these stocks.
After all, investors have the potential to lose a lot of money investing in penny stock – but there is also the potential to see immense returns.
If you do want to get involved in penny stocks, most experts advise that you only put in a small portion of your allocated investment dollars. Put in less than 10 percent of your overall investment funds.
No matter where you investing, just remember to do your research.
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