Theme Theme Theme

Theme basket review: 3D Printing expands on good start to 2022

Equities 4 minutes to read
PG
Peter Garnry

Head of Equity Strategy

Summary:  The 3D Printing theme basket is one of the worst performing baskets over the past year, but this year 3D printing companies are feeling the love from investors with the basket up 2%. Based on our annual review of the theme basket we are expanding the basket from 16 to 21 companies which makes the basket more diversified and interesting. The industry is back into positive revenue growth but profitability is still lacking, but sell-side analysts are seeing through this remaining bullish on the industry.


Is the potential finally being released?

In July 2021, we launched our 3D Printing theme, or additive manufacturing as it is also called, and the key backdrop for the theme is the great potential for more efficient and lightweight manufacturing coupled with software simulations. But the industry has suffered from many false starts since it was commercialized back in the late 1980s.

This year’s performance is as of yesterday’s close +1-9% making our 3D Printing theme basket the fourth best performing basket. However, the past year has seen a 51.4% decline making it the third worst performing basket only surpassed by cannabis (-62.3%) and bubble stocks (-51.6%). The industry is optimistic on 2022, and the pandemic has probably a welcoming tailwind for the industry as global supply chain issues could accelerate more domestic production in the developed world which requires efficient and automated processes to be viable.

The smallest theme is growing up

It was our smallest theme when we launched containing only 16 companies. But in this year’s review we are adding six companies and removing one.

Added:

  • Renishaw
  • Xometry
  • Velo3D
  • Fathom Digital Manufacturing
  • Nano Dimension
  • Shapeways

Removed:

  • ExOne (acquired by Desktop Metal which is in the theme basket)

The net expansion means that the basket now has 21 stocks with a combined market value of $26.1bn, the smallest theme measured on market value up from $22.6bn when we launched the 3D Printing basket. Since July 2021, the median sales growth has improved from -13.3% to 7.3% as industrial demand has improved, but the overall industry is still not profitable with a median ROIC of -7.7%. Sell-side analysts covering the stocks are generally very positive with a 41% spread (median) from current prices to price targets.

NameMkt Cap (USD mn.)Sales growth (%)ROIC (%)Diff to PT (%)5yr return
Renishaw PLC4,86725.622.59.575.1
Allegheny Technologies Inc3,036-6.14.79.513.5
3D Systems Corp2,43516.4-3.824.611.2
Xometry Inc2,24176.3-48.942.0NA
Stratasys Ltd1,7248.2-7.765.823.9
Proto Labs Inc1,5366.55.26.0-6.3
Carpenter Technology Corp1,514-9.7-7.225.7-16.6
Velo3D Inc1,376NANA55.3NA
Desktop Metal Inc1,3131,121.2-38.2129.4NA
Materialise NV1,174-13.3-1.753.8131.9
Fathom Digital Manufacturing C1,143NANA40.7NA
FARO Technologies Inc1,0055.0-2.535.849.0
Nano Dimension Ltd97544.9-8.0155.1-94.3
SGL Carbon SE8704.4-8.536.7-24.2
SLM Solutions Group AG3968.8-16.368.2-59.6
Shapeways Holdings Inc179NA-3.9153.4NA
Prodways Group SA1672.6-4.140.8NA
Meatech 3D Ltd74NA-211.9NANA
voxeljet AG48NA-19.5113.2-56.4
Titomic Ltd36-1.1-96.0NANA
Amaero International Ltd35332.4-58.0NANA
Aggregate / median26,1437.3-7.741.42.5

Source: Bloomberg and Saxo Group

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

Saxo Bank (Schweiz) AG
Beethovenstrasse 33
CH-8002
Zurich
Switzerland

Contact Saxo

Select region

Switzerland
Switzerland

All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law.

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.