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3D Systems Launches Partner Program for Medical Implants

3D Systems Corporation DDD recently pioneered a 'certified partner program' for medical device additive manufacturing companies to help them improve their services. rms Company, the first to be on board, will leverage on 3D Systems’ Direct Metal Printing (DMP) technology to design, develop and manufacture medical implants.

Per the program, 3D Systems’ equipment, process and materials expertise will be combined with rms’ manufacturing prowess. This will aid medical device firms to work on the development and production of FDA-cleared medical devices under one roof. 3D Systems believes that this will also help it to offer the same level of customer experience across all platforms.

The partnership will help customers of both companies access 3D printing, machining and secondary processing capabilities in a seamless manner. Most importantly, the ability to execute all steps from development and production of 3D parts will offer customers a “speed to market” advantage, which is currently missing in the industry.

We believe that the latest partnership program is in line with the company’s efforts to speed up the adoption process of innovative products that can take medical device design and manufacturing to the next level. Encouragingly, shares of 3D Systems have gained 35.6%, outperforming the Zacks categorized Computer-Mini industry’s average gain of 24.3%.

As a matter of fact, 3D Systems is pulling out all stops to boost its medical and healthcare business, given it is the strongest profit churner at the moment. Over the past few years, the company has developed a spectrum of innovative solutions ranging from simulation to implants to boost growth.

Despite the strong stock performance, the company's sales are being affected by waning demand for printers. Also, the Zacks Rank #4 (Sell) company has been grappling with broader market concerns. The industry is battling a widespread decline in demand for enterprise 3D printers for the past two years. Other headwinds, including economic slowdown, inflation, currency fluctuations and commodity price vagaries, have also marred the performance of most players in the industry.

3D Systems’ earnings estimates have moved south in the past couple of months, which indicates bearish analyst sentiment for the stock. The Zacks Consensus Estimate for 2017 earnings has gone down from $0.39 to $0.26 over the past 60 days, due to six downward estimate revisions versus none upward.

Stocks to Consider

Some better-ranked stocks in the broader sector include Applied Materials, Inc. AMAT, Cohu, Inc. COHU and Amkor Technology, Inc. AMKR. While Applied Materials and Cohu sport a Zacks Rank #1 (Strong Buy), Amkor holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

With four back-to-back beats, Applied Materials has an average positive surprise of 3.3% for the trailing four quarters.

Cohu has a striking earnings surprise history, with an average positive surprise of 121.2% for the trailing four quarters, beating estimates all through.

Amkor Technology beat earnings estimates in three out of the trailing four quarters at an average of 43.1%.

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