ATTENTION CRAYON EATING RETARDS: TIME TO SLIDE PROFITS INTO $DM. DESKTOP METAL 🤖🚀🚀🚀 TO $20
Desktop Metal has become one of my favorite companies and largest positions — the more time I spend researching 3D printing and additive manufacturing the more bullish I become on where this market is headed. There will be multiple winners in this industry but I expect $DM to be the leader.
$DM employee count has increased from 180 people in May 2020 to 470 employees as of today.
$DM reiterated their 2021 revenue guidance of $100+ million. Considering they only did $11.3 million in Q1 we should expect to see a massive acceleration in revenues over the next three quarters as you can see below.
$DM also said on the Q1 earnings call they added more customers in 2021 Q1 than all of 2020.
In my opinion, $DM should do at least $200 million in revenues next year (2022) with a shot at $250 million given these recent acquisitions of EnvisionTEC and Adaptive3D plus the launches of Flexcera and Forust which means $DM might only be trading at 10-12x 2022 EV/Sales which is way too cheap for a company with this much hypergrowth potential.
I’m convinced the investors that were selling post-earnings don’t truly understand this company, the industry or the massive upcoming transition to additive manufacturing from some of the largest manufacturers on the planet. I understand that many investors are not as patient as me and aren’t willing to think longer term but that’s just fine because I’m happy to ignore the short term noise and stay bullish given where I think $DM could be trading in 4-5 years.
I have no problem continuing to build my position at these prices. Some of the smartest investors on the planet believe that additive manufacturing will be a $146+ billion industry by the end of this decade and there’s no reason why $DM can’t own 10% of this market.
The last few months have been busy for $DM in terms of deals, announcements, launches and approvals.
They closed the deal with EnvisionTEC for 3D printing polymers.
$DM launched Flexcera for 3D printing dentures [watch here]
$DM launched Forust for 3D printing wood parts/products.
$DM acquired Adaptive3D for 3D printing elastomers and rubber materials.
I don’t deny that 3D printing is becoming a competitive market however $DM has:
- The best high-volume DLP (digital light processing) printers and the most diverse portfolio of materials (225+ and counting)…
The best and fastest high-volume printers on the planet…
- The strongest IP portfolio of issued and pending patents… [click here]
The best management team and dozens of the best early investors, strategic investors and PIPE investors…
- Growing list of global manufacturing customers…
I’m bullish on $DM in the short term but more importantly the long term. In order to have conviction in companies like $DM you need to have an investment thesis about the industry and be able to justify why you think your company has a chance to be the leader in that industry. For all the reasons I mentioned above, I believe $DM will be the winner in additive manufacturing over the next decade.
They are building a robust product/printer portfolio, materials portfolio and patent portfolio. These three factors put them in the strongest position to deliver the best financial metrics and thus shareholder returns.
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June 11, 2021 at 09:52AM