Stratasys Stock Forming A Tradeable Bottom
2022.06.09 10:40
Leading polymer 3D printing solutions provider Stratasys (NASDAQ:SSYS) stock has fallen (-21%) during the 2022 technology bear market. The 3D printing leader has survived the first 3D printing speculative bubble nearly a decade ago that saw shares trading north of $100.
Like most technologies that survive the Gartner Hype Cycle, a few companies actually rise from the ashes as true and mainstream applications for the technology develop.
3D printing is become more commonplace not just for consumers, but within manufacturing, aerospace, biotech, medical equipment, fashion, and automotive industries.
The technology allows for design, prototyping, tooling, and final parts production. Stratasys launched its commercialized fashion solution with Techstyle to directly print to garments, potentially enabling customization and deep personalization for bags, accessories, and textiles.
The Company is enabling companies to 3D print spare parts on the fly to reduce dependence on outside suppliers and rely too much on the global supply chain. Lead times were reduced by 95% for its transportation client Alstom (EPA:ALSO).
Prudent investors looking for entry into the 3D printing segment after the hype can watch for opportunistic pullback levels in Stratasys.
Stratasys, Ltd. Stock Chart
Q1 Fiscal 2022 Earnings Release
On May 16, 2022, Stratasys released its first-quarter fiscal 2022 earnings report for the period ended in March 2022. The Company reported a non-GAAP profit of $0.02 per share versus consensus analyst estimates for a loss of (-$0.04) per share, a $0.06 per share beat. GAAP operating losses was (-$19.6 million).
Revenues rose 21.8% year-over-year (YoY) to $163.43 million beating consensus estimates for $157.45 million. The Company ended the quarter with $475.6 million in cash and no debt as of Mar. 31, 2022. Stratasys CEO Yoav Zeif commented,
“We have advanced a number of strategic initiatives thus far in 2022, including the announced MakerBot business combination with Ultimaker, the publishing of our inaugural ESG Sustainability Report, and our annual flagship manufacturing event where we showcased new offerings in materials, upgrades to existing printing platforms, and an expansion of our software capabilities.
“We are relentless about our focus on execution in our drive to grow our leadership position in polymer 3D printing. With our combination of best-in-class talent, systems offerings, Go-to-Market, and support infrastructure, combined with a robust balance sheet, Stratasys is positioned to build on our first quarter growth across the balance of 2022 and beyond.”
Forward Outlook
Stratasys expects fiscal Q2 2022 revenue growth to reach low to mid-teens as a percentage over Q2 2021. The Company expect fiscal full-year 2022 EPS to come in between $0.14 to $0.19 versus $0.16. Full year 2022 revenues are expected to come in between $685 million to $695 million versus $684 million consensus analyst estimates.
Conference Call Takeaways
CEO Zeif pointed out that Q1 2022 was the strong first quarter performance in six years with solid results across all platforms. All areas of the business showed improvement over pre-COVID 2019.
He is excited for the new Origin p#, H350 SAF, and NEO systems that have gained early momentum. These systems are designed for higher volume production of end-use parts and lending to the growth of the Company’s leadership position in polymer 3D.
The Company created a new entity comprised of MakerBot and Ultimaker to accommodate entry-level 3D printer users while it focuses on the larger healthcare, industrial, and production scale polymer 3D printing.
Stratasys is also focusing on renewable energy projects to sustain eco friendly manufacturing solutions. It has helped its client medical device maker Medtronic (NYSE:MDT) save up to 80% of costs switching to 3D-printer tools from machine tools.
SSYS Opportunistic Price Levels
Using the rifle charts on the weekly and daily time frames provides a precision view of the landscape for SSYS stock. The weekly rifle chart peaked near the $27.62 Fibonacci (fib) level before collapsing towards the $15.60 fib to bottom out. The weekly downtrend stalled with the 5-period moving average (MA) going flat at $19.21 as the 15-period MA continues to fall at $21.57.
The weekly 50-period MA sits at $23.63 above the weekly 200-period MA at $22.09. The weekly stochastic bounced through the 20-band test as it attempts to trigger the weekly market structure low (MSL) buy triggers on a breakout through the $19.70 level.
The daily rifle chart has an uptrend with rising 5-period MA at $19.94 followed by the 15-period MA at $18.91. The daily 50-period MA is falling at $20.81 and 200-period MA is at $24.14 above the daily upper Bollinger® Bands (BBs) at $21.50.
Prudent investors can look for opportunistic pullback levels at the $17.90 fib, $16.75 fib, $15.60 fib, $13.97 fib, $13.00 fib, and the $11.89 fib level. Upside trajectory ranges from the $24.23 fib level.
