All About 3D Printing Company Tinkerine
3D printing stocks have been on a bit of a slump lately. The Materialise (NASDAQ:MTLS) IPO this week is trading at almost the exact same price the shares were issued at, showing that investors are becoming somewhat immune to the hype surrounding this space. As of this month, one other 3D printing company that U.S. investors can now trade is Tinkerine.
Founded in May of 2012, Tinkerine (CVE:TTD) sells consumer 3D printers along with software and consumables. The Company completed a reverse takeover transaction with White Bear Resources earlier this year and began trading on the Canadian Venture Exchange. They also began trading in the US market this month (OTCMKTS:TKSTF). In April of 2014, Tinkerine completed a share transaction at around 23 cents per share for proceeds of around $2.8 million. Of this amount, they currently have $2.5 million in cash on hand to fund their business plan over the next two years. The Company has a present market cap of $16.8 million with shares currently trading at 40 cents. Revenues for the first 3 months of 2014 amounted to $86 thousand, nearly triple the amount in the same period the year prior. No one customer accounted for more than 10% of revenues and over half of sales were to customers in the United States.
Tinkerine sells three models of consumer 3D printer; the Ditto Pro (from $1899), the Ditto (from $1249) and the Litto (from $999). The below comparison shows how their flagship 3D printer, the Ditto Pro, stacks up against the competition:
In addition to selling 3D printers to consumers, the Company’s main focus is to be the first mover in providing 3D printers, software, and consumables to the +10,000 plus schools in Canada. Tinkerine lists at least 15 schools they currently have printers installed in.
When looking at the potential of Tinkerine, what stands out is that there seem to be no barriers to entry for other companies to do exactly what Tinkerine is doing. The Company notes in their investor presentation that there are “40+ me-too players in the market selling DIY open-source kits” and then goes on to say that most of these players don’t have high-performance machines at affordable price points, have poor customer service, and lack in usability. With just 10 employees on staff, it’s difficult to see just what superior customer service Tinkerine can offer with so few people. In regards to usability, the 75-page assembly document for both the Litto and Ditto is intimidating, to say the least. You can, however, order any one of these printers assembled for an additional cost.
Tinkerine’s growth plans involve making acquisitions, establishing partnerships, and strengthening IP. Acquisitions require capital and so does R&D. The $2.5 million in cash they have on hand is expected to fund their business plan for the next 2 years. That amount is relatively small for a company that needs to grow quickly to steal market share from established industry leaders such as 3D Systems. While the focus on the Canadian education sector is compelling, a competitor such as 3D Systems could easily target this niche with vast more marketing and support resources not to mention capital. Investors in Tinkerine (CVE:TTD) will want to see strong revenue growth over the next 2 years which will show that the company is making traction in establishing themselves as a player in the 3D printing space. Any information on the success they are having in building their install base in the Canadian school system will be of interest as well.
Here at Nanalyze, we write about tech stocks a lot, but most of our money goes into a dividend growth strategy. Our 30 dividend stocks provide an income which increases every year. Find out how to build your own growing income streams with dividend growth stocks - Quantigence - A Dividend Growth Investing Strategy - freely available to Nanalyze Premium subscribers.