Why Stratasys Q3 Earnings Were Good Enough

Stratasys Ltd. (NASDAQ: SSYS) reported its most recent quarterly results before the markets opened Tuesday. The company said that it had $0.08 in earnings per share (EPS) and $155.9 million in revenue, compared with a consensus forecast from Thomson Reuters of $0.05 in EPS on revenue of $160.97 billion. The same period of last year reportedly had break-even earnings and $157.18 million in revenue.

During this quarter, gross margin came out to 52.5%, versus 54.0% in the third quarter from last year.

In terms of guidance for the 2017 full year, the company expects to see EPS in the range of $0.40 to $0.48 and revenues between $655 million and $670 million. The consensus estimates call for $0.37 in EPS and $669.25 million in revenue for the year.

The company generated $4.6 million in cash from operations this past quarter. On the books, its cash and cash equivalents totaled $302.80 million at the end of the quarter, up from $280.33 million at the end of the previous fiscal year.

Ilan Levin, CEO of Stratasys, commented:

We achieved significant improvements in operating profit during the third quarter compared to the prior year, driven by our continued focus on aligning our resources to support our long-term strategy of deepening customer engagement and developing high-value applications within our key vertical markets. Our revenue for the third quarter was partially impacted by several large, multi-system orders that were deferred until October. Driven by a more holistic approach to adopting our solutions, we are observing customer behavior characterized by orders for our products that are made up of multiple systems, which introduces higher quarter-to-quarter variations in order timing.

Shares of Stratasys closed Monday at $20.12, with a consensus analyst price target of $26.27 and a 52-week range of $16.37 of $30.88. Following the announcement, the stock was up about 6% at $21.40 in early trading indications Tuesday.

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