End of 3D printing?

3D printing was the darling of the Wall Street a year ago. Everyone was talking about it and the share prices of 3D printing companies shot to the moon as a result. It was way ahead of themselves. As with any stocks, if their valuation could not be supported by the fundamentals, sooner or later they have to come down to face the reality. This is what has happened to this industry and related stocks. Take 3D Systems (DDD), one of the biggest 3D printing companies as an example. The euphoria at that time pushed it to the peak close to $100, a very crazy valuation level. Then it got burst and crashed by 2/3 of its values to about $30 at the moment. What kind of the blood in the streets! Even at this level, its PE is still at 160 but the overall market PE is just around 17. You judge if it is still too expensive.

Having said that, 3D printing still has a great future in general and I don't think it is already ended. It just needs time to consolidate and eventually will come out strongly again. I'm especially interested in the biomedical 3D printing as it has a huge unmet need in front of it. I talked about Organovo (ONVO) before when it was traded at around $8. I cautioned that it could jump up crazily but could also easily nose dive. In other words, it would be very volatile. Along with the overall correction of this sector, ONVO is not immune to it. It is currently traded around $7. But as you can see below, it fairs much better (red) than DDD (blue) during this downturn. It appears it has a strong support as the level of $5-6. To speculate on this kind of new technology, the safest thing to do is to only put in a small amount of money when they are at the level with a strong support. As long as this support level holds, you should also hold and you should take some profit off the table if it goes up too much too fast. If you play this rationally, you may end up with several times your initial investment. I still have a great faith on biomedical 3D printing!