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3D Systems (DDD) to Report Q3 Earnings: What's in Store?

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3D Systems (DDD) to Report Q3 Earnings: What's in Store?

3D Systems (DDD) Q3 results might benefit from robust demand in 3D printing market and uptrend in its healthcare business. However, increased investments are likely to keep margins under pressure.

3D Systems Corporation DDD is scheduled to report third-quarter 2018 results on Oct 30.

In the last reported quarter, the company reported non-GAAP earnings of 6 cents per share. The Zacks Consensus Estimate was pegged at breakeven.

Revenues of $176.6 million reflected a year-over-year increase of 10.7%. Moreover, the top line beat the Zacks Consensus Estimate of $166 million.

The Zacks Consensus Estimate for earnings and revenues for the third quarter is pegged at 2 cents and $170.11 million, reflecting year-over-year growth of 11.25% and 110%, respectively.

3D Systems Corporation Price and EPS Surprise

3D Systems Corporation Price and EPS Surprise | 3D Systems Corporation Quote

Let's see how things are shaping up for the upcoming announcement.

Factors Likely to Drive Results

3D Systems is currently witnessing robust growth across most of its end business. Steady demand for its healthcare, software, materials and on-demand manufacturing, along with increased printer unit sales are proving conducive to the top line.

The company remains especially bullish on the prospects of its healthcare business. In the last reported quarter, 3D Systems witnessed a 26% rise in Healthcare revenues. We believe that the availability of its On Demand Anatomical Modelling Service and the launch of DMP Flex 100 and DMP Dental 100 3D printers in the final weeks of the June quarter are likely to provide further impetus to the demand for its healthcare solutions.

We note that increase in demand for 3D printing solutions is driving the company’s printer revenues and unit sales. The availability of its Figure 4 Standalone 3D printer, which was announced toward the middle of the third quarter, is expected to boost this segment further.

This apart, the company also continues to see steady performance of its Software business and believes it to be a growth driver.

However, increased investments in services and on-demand manufacturing are expected to keep margins under pressure.

Moreover persistent investment in go-to-market, IT transformation, higher compensation cost and legal expense remain other concerns.

What the Zacks Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. Sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

3D Systems has a Zacks Rank #3 and an Earnings ESP of 0.00%.

Stocks to Consider

Here are some stocks that you may consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:

Vishay Intertechnology VSH with an Earnings ESP of +0.62% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Check Point Software Technologies Ltd. CHKP, with an Earnings ESP of +0.63% and a Zacks Rank #3.

Avnet AVT with an Earnings ESP of +0.20% and a Zacks Rank #3.

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