The article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology  – Senior Analyst at I Know First. 

DDD Stock Price Forecast: 3D Systems Found A Gold Mine In Restorative Dentistry

Summary:

• The world’s grows ageing population is fueling the growth in restorative dentistry. Demand for artificial teeth/dentures will continuously to increase.
• The release of 3D System’s NextDent 5100 for digital dentistry is a timely help for the world’s growing demand for restorative dentistry.
• Costing less than $10,000, the NextDent 3D printer is affordable even for a small-town dental studio. Return of investment is easy – dentists charge at least $500 for dentures.
• Unlike the traditional manual way of making dentures, 3D-printed dentures and replacement tooth can be made in minutes.
• DDD has positive near and long-term algorithmic market trend forecasts.

The 6-month stock performance of 3D Systems (DDD) is disappointing. However, I saw something to celebrate when 3D Systems launched its NextDent 5100 digital dentistry 3D printer. Taking advantage of the growing market for false teeth/dentures can greatly help 3D System’s five-year growth performance. Dentures are under the growing restorative dentistry industry, which was worth $14.59 billion in 2016. The global restorative dentistry business is expected to grow at 6.7% CAGR until 2025.

(Source: 3D Systems/NextDent)

Selling both the 3D printer and the dental materials give 3D Systems two ways to benefit from digital dentistry. The acquisition of NextDent last year gave 3D Systems more than 18 biocompatible materials which it can sell to dentists and dental clinics. Like in traditional inkjet/laser printers, the bigger money is in supplying the materials.

As you can see from the chart below, restorative materials for dental applications are the biggest revenue generator for the U.S. restorative dentistry business. Dentists and dental clinics who purchase a $10K 3D printer could become repeat customers for dental materials for many years. They could potentially contribute 50x or 100x in 3D printing materials in a five-year period.

(Source: GrandView Research)

Ageing Population Fuels The Growing Need For Restorative Dentistry

The world’s ageing population is growing faster. Even my country, the Philippines, has an ageing population. Statista’s chart below clearly hints dentists are getting richer making dentures for the world’s more than 650 million senior citizens. The market is not limited to senior citizens. There are also hundreds of millions of people aged six to 60 who need full/partial teeth replacement.

(Source: Statista)

Europe and North America are the regions with the highest percentage of 64 years old or older citizens. The 18% share of 65+++ citizens in Europe compels me to believe that it has the highest demand for restorative dentistry. The chart below confirms this, Europe is indeed the biggest market for cosmetic or restorative dentistry.

Europe and North America’s affluent citizens can afford the highest dental fees. 3D Systems’ sub-$10,000 NextDent 5100 3D printer is an easy purchase for dentists/dental clinics in those two regions. Just look at the chart below listing the typical costs of getting dentures in Western countries. A dentist can recoup the cost of a $10k NextDent 3D Printer after making 10 or 20 dentures.

(Source: U.S. Dental Association)

Furthermore, unlike handcrafted dentures (which takes days/weeks to perfection), the personalized dentures and orthodontic braces can be 3D printed in a matter of minutes.  Cost-wise, 3D-printed dentures and orthodontist braces could be more cost-efficient than those handcrafted ones.

Conclusion

Mainstream adoption of home/office 3D printers hasn’t happened yet. 3D Systems’ brightest hope for reinvigorating its fortune lies in medical-related applications. Restorative and cosmetic dentistry is a fertile expansion area for 3D Systems’ additive manufacturing printers and materials.

In my guesstimate, restorative/cosmetic dentistry can contribute as much as $300 million to 3D Systems’ topline starting 2019. It will all depend on how effective it can market NextDent 3D printers. Stratasys (SSYS) also offers 3D printers for digital dentistry. There are already more than a dozen 3D dental printers available in the market today. Selling the NextDent 5100 will require serious advertising and promotion.

I still believe 3D Systems is worth adding to your long-term portfolio. The long anticipated 3D printing revolution has not arrived yet but when it does, 3D Systems will be among the top beneficiaries. My bullish rating DDD is in line with this stock’s very positive algorithmic market trend forecasts. Going long on DDD and holding on to it for more than one year could be financially rewarding.

Past I Know First Forecast Success with DDD

I Know First’s algorithm has made accurate predictions on DDD in the past, such as its bullish article published on May 29, 2016.  DDD shares have risen by 67% in 1 year in a good agreement with this bullish forecast.

Current I Know First subscribers received this bullish forecast for DDD on May 29, 2016.

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I Know First Algorithm Heatmap Explanation

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