Why 3D Systems Stock Just Popped 15%

What happened

Shares of 3D Systems (NYSE:DDD) are on a tear today, up 15.3% at 12:25 p.m. EST. This morning, the 3D-printing company announced a 100,000-square-foot expansion of its headquarters campus in Rock Hill, South Carolina.  

So what

Why such excitement over a construction project? This isn’t just an addition of office space we’re talking about. Rather, 3D says it will be consolidating “materials manufacturing, quality, and logistics operations” and putting them all next door to management. It will also expand its “advanced manufacturing capabilities for both metal and polymer components,” and add “new and expanded materials development laboratories.” The aim is to improve operating efficiencies, accelerate product development, and reduce time to market.

Or in financial terms, boosting sales and improving profit margins.

Origami dollar folded into an arrow pointing up

Image source: Getty Images.

Now what

CEO Jeffrey Graves explained that the floor-space expansion is part of the company’s restructuring and reorganization plan announced last year. This is the same plan that permitted 3D to raise the possibility that it will finally return to profitability in the fourth quarter, igniting an 84.5% rally in the stock. So it’s understandable that investors are taking today’s news as good news.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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View more information: https://www.fool.com/investing/2021/02/03/why-3d-systems-stock-just-popped-15/

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