Don’t Panic Over 3D Systems Corporation (DDD)’s Plunge

In fact, considering 3D Systems Corporation (NYSE:DDD) operates in the ever-changing, fast-growing additive manufacturing industry, I’d be downright worried if R&D spending didn’t increase ,as the company faces fierce competition from fellow 3-D printing companies — among them Stratasys, Ltd. (NASDAQ:SSYS), which was unsurprisingly dubbed guilty by association Tuesday and is down more than 4% as of this writing.

Remember, Stratasys, Ltd. (NASDAQ:SSYS) last month announced that it will merge with up-and-coming 3-D printing company MakerBot in a $400 million deal, putting 3D Systems’ own affordable, consumer-centric Cube line of printers squarely in its crosshairs.

Of course, that merger also resulted in added dilution for Stratasys, Ltd. (NASDAQ:SSYS) investors, as the company issued 4.76 million new shares in exchange for 100% of MakerBot’s outstanding capital stock. In addition, Stratasys could end up creating another 2.38 million shares by the end of 2014, resulting from potential “performance-based earn-outs” for MakerBot executives. As a result, Stratasys shareholders could be in for a similar negative surprise when their company reports earnings on Aug. 8.

Even so, as with 3D Systems’ pullback today, something tells me Stratasys’ report will once again prove that the 3-D printing industry remains alive and well.

In the end, that’s why I think today’s pullback is no reason to panic and represents a fantastic buying opportunity in both companies for patient, long-term investors.

The article Don’t Panic Over 3D Systems’ Plunge originally appeared on Fool.com is written by Steve Symington.

Fool contributor Steve Symington owns shares of 3D Systems. The Motley Fool recommends and owns shares of 3D Systems and Stratasys and has options on on 3D Systems.

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