3D Printing crosses over $80

3D Systems Corp. (NYSE: DDD) is a short sell recommendation in our Equity Trades portfolio at a limit price of $80.  Yesterday it crossed above that price and remains there today, so it is now in play for investors who are comfortable trading on margin or buying put options.

Also yesterday, the company’s CEO sold 25,000 shares at a price of $80.91.  Over the past twelve weeks corporate “insiders” have sold more than 162,000 shares.  While there can be perfectly good reasons for a company’s officers and directors to sell some stock from time to time, it is disconcerting to see these insiders unload almost $13 million of stock in such a short period of time with the stock at a historically high price.

While we like the company and believe that three dimensional printing will eventually become a significant sector, the stock has become grossly overvalued now trading at 176 times forward twelve months earnings and paying no dividend.  However, since trendy tech stocks can continue to rise above all rational pricing metrics, we also recommend a stop loss position at $86 for all short positions to limit losses. 

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