We recently published a list of 10 Worst 3D Printing and Additive Manufacturing Stocks To Buy. In this article, we are going to take a look at where Xometry (NASDAQ:XMTR) stands against other worst 3D printing and additive manufacturing stocks.
The Global 3D Printing & Additive Manufacturing Market
3D printing and additive manufacturing (AM) is a technology that creates three-dimensional objects by layering materials. This technology offers a range of benefits, including the ability to use various materials such as plastics, metals, and biomaterials. It has diverse applications across engineering, healthcare, and entertainment industries and employs different processes like stereolithography and digital light processing. Notably, 3D printing enables the production of parts with high precision and reliability and allows for the creation of customized parts with intricate geometric structures.
According to a report by Precedence Research, the global 3D printing market was valued at $24.61 billion in 2024 and is expected to reach $117.78 billion by 2033, expanding at a CAGR of 19%. North America accounts for over 34% of revenue share, whereas the European market experienced the fastest growth in 2023. Europe is poised to emerge as a hub for additive manufacturing, driven by the presence of numerous industry players who possess in-depth technical expertise in additive manufacturing techniques. In terms of printer type, industrial printers led the way, generating more than 77% of total revenues. Stereolithography technology, which uses ultraviolet (UV) light to create objects from liquid resin, played a significant role, contributing over 11% of total revenues.
The 3D printing market revealed a strong presence of prototyping applications, which emerged as the largest segment, accounting for over 55% of total revenues. This indicates that the technology is being widely adopted to create prototypes, which is a critical stage in the product development process. The prototyping segment’s dominance can be attributed to the ability of 3D printing to rapidly produce complex designs, test, and iterate on them, and refine the final product. This has led to increased adoption in various industries, with the automotive sector being a prime example. The automotive vertical was the leading industry, capturing over 25% of revenue share, as 3D printing is being used to create complex car parts, tooling, and prototypes. Furthermore, the market also saw a significant contribution from metal materials, which dominated the market, accounting for over 53% of global revenue.
ARK Invest Forecasts 40% Annual Growth for 3D Printing Industry
According to Tasha Keen, Director of Investment Analysis and Institutional Strategies at ARK Invest, 3D printing will scale at a 40% annually to reach $180 billion by 2030. With its potential to disrupt industries worth over $4 trillion in revenue, Keen is confident that 3D printing will become a transformative technology that revolutionizes how industries manufacture and produce goods.
According to Keen, 3D printing is already being used extensively in prototyping, tooling, and production, with the latter being the largest addressable opportunity. The automotive industry, in particular, is embracing 3D printing, with companies such as Tesla experimenting with printing entire vehicle underbodies. The technology has the potential to simplify supply chains, reduce labour costs, and improve product strength by eliminating joints. Moreover, 3D printing can significantly reduce automotive development time and design validation costs.
Beyond automotive, 3D printing is also transforming the medical industry, enabling breakthroughs in surgeries and improving patient outcomes. Using patient-specific 3D printed tools and moulds has improved surgical accuracy and results by 40-50% and reduced operating time by 30%. While the 3D printing industry itself has grown slower than expected, Keen believes that software-enabled 3D printers will be a game-changer. These machines, equipped with sensors, can collect data on each print and send it back to manufacturers, enabling them to improve the print process over time. Keen forecasts that this could lead to higher margins for printer manufacturers and create a more sustainable business model.
The 3D printing market is poised for significant growth, driven by its diverse applications across various industries, including engineering, healthcare, and entertainment. The technology’s ability to produce parts with high precision and reliability, as well as its capacity to create customized parts with geometric structures, has made it an attractive solution for companies looking to innovate and improve their product development processes. With that in context, let’s take a look at the 10 worst 3d printing and additive manufacturing stocks to buy.
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A machinist operating a CNC machine in a well-lit facility, scrutinizing the quality of a part.
Xometry (NASDAQ:XMTR)
Short % of Float: 14.86%
Number of Hedge Fund Investors in Q2 2024: 9
Xometry (NASDAQ:XMTR) is an on-demand manufacturing marketplace that connects customers with suppliers for custom manufacturing services, including 3D printing, CNC machining, and injection moulding. The company’s platform offers rapid prototyping and production across multiple industries, such as aerospace, automotive, and healthcare. Xometry (NASDAQ:XMTR) uses advanced technologies to provide cost-effective and quick-turnaround solutions for businesses of all sizes.
In Q2, Xometry’s (NASDAQ:XMTR) revenue increased 19% year-over-year (YoY) to $133 million. This growth was driven by the company’s international segment, which grew 31% YoY. The company’s marketplace segment has a gross margin of 30.8%, which is impressive considering the competitive nature of the on-demand manufacturing industry. Moreover, management reaffirmed guidance of 20% revenue growth and a 35% increase in marketplace gross margin in 2024.
The company’s growth in the international segment demonstrates its potential for growth outside the competitive US market. With fewer direct competitors in global markets, Xometry (NASDAQ:XMTR) can increase its margins and establish itself as a leading player in the on-demand manufacturing industry. The company’s expansion plans outside the US will increase operating expenses in the short term and help achieve a positive EBITDA for the company.
The company is also trying to scale its supplier network and increase its marketplace revenue which will lead to higher gross margins and improved profitability. A higher gross margin will contribute to improved profitability and increase Xometry’s competitiveness in the market. Despite 14.86% of shares being shorted, 7 hedge funds showed a bullish stance on the stock as of the second quarter and own stocks worth $29.04 million. Owls Nest Partners is the largest shareholder in the company, holding $1.77 million worth of stock as of June 30.
Overall, XMTR ranks 1st on our list of 10 worst 3D printing and additive manufacturing stocks to buy. While we acknowledge the potential of XMTR as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than XMTR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
