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Why 3D Systems Stock Popped (Again) on Monday

What happened

Can anything stop 3D Systems (NYSE: DDD)?

Last week, shares of the maker of 3D printers more than doubled in a single day of frenzied trading Thursday, then drifted higher on Friday. On Monday morning, they picked up where they left off, climbing another 9% through 11:50 a.m. EST -- apparently on no "new" news at all.

Image source: Getty Images.

So what

But perhaps 3D Systems investors don't need any more news to fuel their optimism. Last week's revelations were good enough. In an earnings preannouncement, the company confirmed that Q4 sales are going to beat analysts' estimates with a stick, coming in between $170 million and $176 million -- a tight range that suggests substantial certainty about how good the news will be when official earnings come out.

It's not yet certain whether 3D Systems will earn a profit on these sales -- but it might. Management said its GAAP bottom-line result could be anywhere from a loss of $8.6 million to a $500,000 profit.

Now what

Just the chance that 3D Systems could break its losing streak -- 15 straight quarters without a single GAAP profit -- has been enough to give investors hope that things are finally turning around. And with analysts on average now predicting that the company could earn a profit for the whole year -- then grow that profit at a 30% annualized rate over the next five years -- 2021 could be the year 3D Systems stock begins growing again.

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Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends 3D Systems. The Motley Fool has a disclosure policy.


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