Thinking Inside the Box to (3D) Print Gains

printThe now decade-old public 3D printing craze has taken second fiddle to the myriad market trends and hype trains that inundate the stock market, but there are enough materials left to the manufacture profit.

As of late, the stock market has been inundated with trends, hype, and FOMO. Buzzwords like EV, crypto, short squeeze, SPACs, and more have gripped finance headlines, leaving little room for other industries to step into the spotlight. But that often creates the best chances to buy into sidelined industries, especially ones with both hype and real growth. And one of the few industries that can wear that label is 3D printing. 

Public and tradable 3D printing companies have been around for the better part of the last decade, with some companies like Proto Labs (NYSE:$PRLB) and 3D Systems (NYSE:$DDD) having gone public in 2012 and 2011, respectively.

Ark Invest even formed The 3D Printing ETF (NYSE:$PRNT) in 2016, signifying both Cathie Woods’s confidence in the industry as well as the plethora of publicly traded companies that exist; the ETF has a total of 57 holdings, 12 of which are 3D printing companies, and dozens of others that supply these companies with necessary products and technology.

 

But why is this such a big deal, and why now? 

As any brief glimpse of charts can tell you, it’s a big deal now because the price action has been getting big now. At the time of writing, $PRNT has gained more than 100% in the past year and 140% in the past 5 years. A massive bump for an ETF, one can view this as representative of the entire 3D printing industry, and its chart shows that it’s only beginning to spike.

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Materialise (NASDAQ:$MTLS) 5-year chart; as seen, the largest spikes in growth are seen in the 2020-2021 interval

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But as encouraging as a doubling of returns may be, individual 3D printing stocks have been leaving $PRNT’s returns in the dust. At the time of writing, Materialise (NASDAQ:$MTLS) has shown a 5-year return of a whopping 669%, and spiked 208% in 2020 alone. Not only is the latter impressive as it captures what seems to be a plurality of the stock’s 669% 5-year return, but it’s also key to note that this comes in the most recent year; a quick look at the chart shows Materialize has skyrocketed primarily in recent months.

Proto Labs has also performed exceptionally as well, with a 163% 5-year gain at the time of writing. And it’d be remiss to leave out ExOne (NASDAQ: $XONE), which is The 3D Printing ETF’s biggest holding. Exone has skyrocketed a jaw-dropping 479% in just 2021. Investors seem to be piling into 3D printing under the cover of the dust thrown up by events such as the Gamestop war.

 

A world of pure, printed imagination

But in this case, the data is just the tip of the iceberg; data is derived from past performance, but investors look to the future. Recent 3D printing innovations seem almost like science fiction, but they’re far from fictional.

This month, SQ4D just listed the first ever 3D printed house for sale in New York, and the CEO Kirk Andersen declares that “[t]his is the future, there is no doubt about it.” He plans on ramping up production to “radical” levels, and his vision is to “print homes cheap, fast, and strong.” 

And this vision is not just a thing of the future; Stephen King the Zillow Premier agent (not the novelist) says that “[t]he cost of construction is 50% cheaper than the cost of comparable newly-constructed homes in Riverhead, New York, and 10 times faster.”

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A model of a 3D printed house, part of an initiative by non-profit New Story and tech firm ICON

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But this technology goes beyond merely single houses. American non-profit New Story and tech firm ICON have teamed up to print not just one, but a neighborhood of 50 3D printed houses in Tabasco, Mexico. This 3D printed neighborhood project “work[s] to combat global homelessness” by employing local labor to construct natural disaster-resistant houses that include two bedrooms, a living room, a kitchen, and a bathroom. And the CEO, Brett Hagler, hopes to “get this technology into the hands of other housing non-profits and other governments that have agendas to solve very serious problems in their towns and their cities.” 

“The cost of construction is 50% cheaper than the cost of comparable newly-constructed homes in Riverhead, New York, and 10 times faster,” – Stephen King, Zillow Premier agent

This real estate boom alone is a big bullish case for the 3D printing industry, but that’s not even close to all there is to offer. This past week, MIT revealed their new project “LaserFactory,” which aims to be a “one-stop shop” for constructing 3D printed robots, drones, and myriad other machines via both design software and construction hardware components. MIT aims to launch this project later this year and will provide computer hardware kits to users to design their own contraptions. 

And 3D printing doesn’t just apply to robots, houses, or things around us; it affects things that we ingest as well. Israeli food lab Aleph Farms revealed that they successfully 3D printed the world’s first ribeye steak. Aleph Farms projects that dining areas will have the steak available within a year at a cost of $50; while expensive, these costs will certainly decrease as production and technical efficiency grows over time.

With the cultural push for veganism and the macroscopic push for greener agriculture, humane treatment of animals, and the search for sustainable food consumption, 3D printed food offers a boat big enough to float even the biggest of Wall Street whales.

“The big idea is to open source and democratize and try to get this technology into the hands of other housing non-profits and other governments that have agendas to solve very serious problems in their towns and their cities,” – Brett Hagler, CEO of New Story

 

So if I jump into 3D printing, when will my portfolio start printing?

That’s a difficult question to answer, as always, but the answer may be parsed through the data. The price action on 3D printing stocks shows a wave of momentum that has lasted months and has just recently accelerated. Coupled with the aforementioned innovations in 3D printing that arrived just this month, the 3D printing space is looking bullish indeed.

The future of 3D printing looks to be a push for a cleaner, cheaper, more innovative, and more equitable world, a world that investors can both grow and be a part of right now.

Christopher Koh
Christopher Koh

Christopher is a current 3rd year student at UCLA, pursuing a Bachelor’s in Economics and Political Science, and is seeking a career in buy-side finance. He works as an analyst for Internet Bull Report at UCLA, is the Director of Investments for the Business Law & Investing Society, and also worked as an investment banking analyst for Genz & Associates. Christopher’s passions include stocks, martial arts, and philosophy, and he spends most of his free time reading, cooking, and doing due diligence for his own stock portfolio.