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Why 3D Systems Stock Just Popped 13% Ahead of Earnings

What happened

Additive manufacturing specialist 3D Systems (NYSE: DDD) isn't due to report its next crop of earnings for another couple of weeks -- Nov. 5, to be precise. Despite earnings being only barely on the horizon, though, and in the absence of any other news directly affecting the stock, 3D Systems shares jumped as much as 14% earlier today, and remain up 13.5% here at the 3:35 p.m. EDT mark.

Why the sudden jump?

Image source: Getty Images.

So what

Lacking any more obvious catalysts, my best guess at this point is that 3D stock is reacting positively to earnings news out of Tesla (NASDAQ: TSLA), which last night reported both impressive free cash flow and also strong sales growth of 39% year over year.

Tesla, as you may have heard, was recently spotted hiring technician(s) to operate its 3D printing equipment, and confiding that this aspect of its manufacturing operations is "rapidly growing."

Now what

Now, this doesn't necessarily mean that Tesla is doing more business with 3D printer-maker 3D Systems, in particular. Today's share price spike at 3D Systems could be entirely an overreaction -- or a reaction to some other news (of which I'm unaware) that's ongoing.

But it's recently been brought to my attention (thanks, dear reader!) that at least one of Tesla's R&D prototyping managers is a former SLS applications engineer at 3D Systems, which may suggest an affinity for that company's products within Tesla.

As far as supporting a buy thesis goes, this one is a rather thin straw -- and I'm not at all convinced it suffices to justify a near-14% spike in 3D Systems' share price today. Then again, maybe next month's earnings report will show us something more substantial.

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


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