3D Printing or 3D Pretending
In 2004, the term “nanotechnology” came across investor’s radar with many companies injecting the prefix or suffix “nano” into their value proposition in the hopes of enticing investors. Earlier than that, the “.com” era heralded a slew of companies claiming to be the next big thing for investors, most of which died a quick death. In today’s market, we see much the same behavior with many companies suddenly discovering their desire to become players in the 3D printing market. Companies that we have highlighted before such as Camtek, Rainbow Coral Corp, Makism, and Groupe Gorge have demonstrated an intent to enter the 3D printing space, but have not yet shown that they are able to execute on that vision with meaningful revenues.
Groupe Gorge is the best contender of the bunch having purchased Prodways which has three printers on offer; the M350, the K20 for composite parts, and the D35 for biomedical applications. The question for Groupe Gorge is, what meaningful impact will this acquisition have on the bottom line going forward? Makism has had trading suspended by the SEC. Camtek is highly questionable in their claims of being able to truly 3D print electronics. Rainbow Coral has lofty aspirations but little else to show for it. In the meantime, the list of 3D printing aspirants keeps growing.
Enter IKONICS Corporation (NASDAQ:IKNX), who’s one-sentence statement in their most recent 10-K filing resulted in a +100% increase in their share price over the past month:
The Company has modified its DTX technology to enter the market for prototyping and 3D printing.
3D printing investors should be wary of such claims. The mere mention of 3D printing in a financial statement hardly constitutes a real opportunity. What is the opportunity cost for a 3D printing investor to take a gamble on the mention of 3D printing in a company’s financial statement as opposed to taking a position in a known 3D printing leader such as 3D Systems (NYSE:DDD) or Stratasys (NASDAQ:SSYS)? There is a big difference between being a speculator and an investor. No doubt the list of small market cap, low float companies that mention their intent to enter the 3D printing space will continue to grow, and their stock prices may experience a temporary bump upwards as a result. The question to ask is, if I truly believe in the potential growth of 3D printing as an investing opportunity, where is my money best placed? Is it in a known commodity or a speculative opportunity based on hype?
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