Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

Add Innovation To Your Portfolio With This 3D Printing ETF

Published 20/05/2022, 08:54
Updated 02/09/2020, 07:05

Despite Wall Street's current elevated volatility levels, seasoned investors have not stopped scouring for companies that have the potential to develop world-changing technologies.

One booming theme within the innovation space is 3D printing, also known as additive manufacturing. It consists of three main components: hardware, software, and the materials used to complete printing.

3D printing goes back over half a century, but it is only in the past decade that it has become more mainstream, in part thanks to decreasing costs, especially of hardware. Now, the technology is used extensively in numerous industries, including aerospace, automotive, education, construction, healthcare, manufacturing, and robotics, among others.

Recent research highlights that:

"The global 3D printing market was valued at USD 13.84 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 20.8% from 2022 to 2030."

Consequently, Wall Street has been paying close attention to 3D printing stocks. For instance, in July 2016, the S&P Kensho 3D Printing Index was launched. In early 2021, the index hit a record high.

But since then, it has been a different story, as the ETF lost close to a third of its value in the past 12 months. Yet, this decline in 3D printing shares also means better opportunities for buy-and-hold investors in this burgeoning field.

Examples Of 3D Printing Stocks

InvestingPro provides access to 3D printing stocks that can appeal to long-term investors. For instance, among the large-capitalization (cap) stocks, we see industrial software names Autodesk (NASDAQ:ADSK) and PTC (NASDAQ:PTC); simulation software company Ansys (NASDAQ:ANSS); 3D Systems (NYSE:DDD); and digital contract manufacturer Proto Labs (NYSE:PRLB).

The fastest-growing 3D printing companies are the specialty medical device manufacturer ConforMIS (NASDAQ:CFMS); 3D printing business Stratasys (NASDAQ:SSYS); Autodesk; and PTC.

Meanwhile, those looking for undervalued 3D printing shares may want to research Proto Labs; PTC; early-stage biotech stock Organovo (NASDAQ:ONVO), which specializes in 3D bioprinting; Ansys; Autodesk; FARO Technologies (NASDAQ:FARO), which focuses on 3D imaging and measurement equipment; Stratasys and 3D Systems. These stocks also have bullish analyst targets, meaning they could see higher prices in the coming months.

Finally, among 3D printing stocks, low price to book (P/B) ratio shares may also deserve readers' attention. For instance, Organovo and ConforMIS have P/B ratios under 1x. SSYS, PRLB, and DDD stocks also have relatively low P/B values.

Choosing stocks appropriate for long-term portfolios requires research, which may prove difficult for most retail investors. We should also note that stock lists provided on the InvestingPro website may not always fully meet the full objectives of all readers. In that case, they may also consider researching an exchange-traded fund (ETF) that holds a basket of shares in the 3D ecosystem.

The 3D Printing ETF

  • Current Price: $22.80
  • 52-week range: $20.92 - $40.62
  • Expense ratio: 0.66% per year

Our fund for today, the 3D Printing ETF (NYSE:PRNT), is a thematic ETF giving access to a wide range of innovative companies within the 3D printing space. These names focus on hardware, computer-aided design (CAD), scanning, measurement, printing materials, and 3D printing.

PRNT Weekly Chart

PRNT, which tracks the Total 3D-Printing Index, currently has 54 holdings. The fund was first listed in July 2016 and is part of the family of ARK ETFs managed by Cathie Wood.

Close to three-quarters of the stocks come from North America, followed by Western Europe (22.72%), Africa/Middle East (3.83%), and Asia Pacific (0.10%).

With regards to sectors, we see information technology (55.9%), Industrials (23.5%), health care (10.6%), and consumer discretionary (4.4%), among others. The top 10 stocks in the portfolio comprise over a third of $240.41 million in net assets.

Among the leading businesses on the roster are PTC, positioning technology name Trimble (NASDAQ:TRMB); Autodesk; Microsoft (NASDAQ:MSFT); HP (NYSE:HPQ), which offers computing, imaging and printing products; France-based Dassault Systemes (OTC:DASTY), known for its 3D design software; Ansys; Velo3D (NYSE:VLD), which makes 3D metal printers; Desktop Metal (NYSE:DM), which provides additive manufacturing technologies; and engineering software and services company Altair Engineering (NASDAQ:ALTR).

In February 2021, PRNT went over $50 to hit a record high. However, over the past 52 weeks, it has declined by around 38%. And year-to-date, the ETF has lost a third of its value.

By comparison, the Nasdaq 100 is down around 27% YTD. Potential investors who believe the selling may be drying up could regard the decline in PRNT as an opportunity to buy into this emerging theme.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.