Yahoo Finance Investors in 3D Systems (NYSE:DDD) from a year ago are still down 54%, even after 11% gain this past week
It's nice to see the 3D Systems Corporation (NYSE:DDD) share price up 11% in a week. But that's small comfort given the dismal price performance over the last year. Like a receding glacier in a warming world, the share price has melted 54% in that period. The share price recovery is not so impressive when you consider the fall. Arguably, the fall was overdone.
The recent uptick of 11% could be a positive sign of things to come, so let's take a look at historical fundamentals.
See our latest analysis for 3D Systems
3D Systems isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
3D Systems' revenue didn't grow at all in the last year. In fact, it fell 13%. That looks pretty grim, at a glance. The share price drop of 54% is understandable given the company doesn't have profits to boast of. Having said that, if growth is coming in the future, the stock may have better days ahead. We don't generally like to own companies with falling revenues and no profits, so we're pretty cautious of this one, at the moment.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
It's probably worth noting we've seen significant insider buying in the last quarter, which we consider a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. If you are thinking of buying or selling 3D Systems stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
While the broader market lost about 15% in the twelve months, 3D Systems shareholders did even worse, losing 54%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 3% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand 3D Systems better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with 3D Systems , and understanding them should be part of your investment process.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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