3D hype is over, the potential is massive, and the stocks are undervalued, says Michael A. Robinson of Money Morning.
Many 3D stocks have soared...and then fallen back to earth. Some pundits claim this was nothing but hype—or another tech bubble that now has burst. Still others are writing this off as little more than a novelty niche.
Don't make that mistake.
3D printing is in the earliest stages of what's destined to become an entire new industry. So massive, in fact, that even toy companies are making a play for market share.
Wobble Works, a toy and robotics maker, has unveiled a pen called the "3Doodler" that allows you to "draw" three-dimensional forms, like the Eiffel Tower.
What 3Doodler has done is to lay a foundation for a new 3D printing segment—low-cost, portable machines that will unshackle these creative users, just as laptops did for office workers.
Here are three ways you can play the 3D printing market.
ExOne (XONE) went public on February 7, and shares rose 25% on the first day of trading. CEO Kent Rockwell recently told Investor’s Business Daily that he sees sharp differences between ExOne and the two biggest firms in the market, 3D Systems (DDD) and Stratasys (SSYS). Until a recent correction, both had been among the market's top-performing stocks.
Unlike those bigger firms, ExOne focuses exclusively on large industrial firms such as aerospace, automotive, and heavy-equipment makers. More importantly, Rockwell says, ExOne's printers can handle a wider range of materials.
These tougher materials allow ExOne printers to make production-grade objects and castings from stainless steel, bronze, glass, and ceramics. ExOne is also working on ways to use titanium, tungsten carbide, aluminum, and magnesium—stock-in-trade materials for heavy industry.
Proto Labs (PRLB), public since February 2012, doesn't flash its 3D printing credentials. Instead, the firm bills itself as a high-speed provider of prototypes and small batch runs of the injection-molded plastic parts that are integral to a wide range of modern products and components, for markets like medical devices, electronics, appliances, automotive and consumer products.
Proto Labs believes it's selling "solutions", such as fast-delivery times—services that designers and engineers can use to quickly transform their three-dimensional designs into actual parts.
Proto Labs turns out those parts using a process known as computer numerical code. It uses engineering-grade resins as well as metals. The firm's "Protomold" plastic injection service offers designers hundreds of materials to choose from.
iRobot (IRBT), remains the most speculative 3D printing play, as it's still in the early stages of making its move into the sector. The firm is best known for its range of military and home-cleaning robots.
But it does have a unique idea that could have a huge impact on how a wide range of products are made—not to mention a new source of sales for this small-cap leader.
iRobot says its new "Robotic Fabricator" (patent pending), will automate the entire 3D printing process. iRobot still hasn't said if it will sell the fabricators to other firms or simply use them to boost profits.
Although 3D printing stocks have come under pressure after enjoying quite a run, don't let that deter you. We're watching the birth of a crucial new industry. That doesn't happen often. But when it does, the profit opportunities are massive.
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