Skepticism Grows as 3D Systems Corporation (DDD) Struggles

3D Systems Corporation (NYSE:DDD) forecast lower-than-expected first-quarter profit and revenue

Apr 24, 2015 at 1:53 PM
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3D Systems Corporation (NYSE:DDD) is bucking the broad-market trend higher -- down 9.4% at $27.33, and on the short-sale-restricted list. Sparking the day's sell-off is the company's lower-than-expected first-quarter forecast, and subsequent round of bearish brokerage notes. Against this background, put volume has soared to four times what's typically seen at this point in the day, with a number of speculators apparently betting on the stock to fall to multi-year lows.

Drilling down, the security's August 20 put has seen the most action today, and it appears as if new positions are being purchased here.  Specifically, it looks as if a large block of 2,800 contracts was bought to open earlier, as one trader targets a move to levels not seen since June 2012 by the close on Friday, Aug. 21 -- when the options expire.

Widening the sentiment scope reveals today's accelerated put activity is just more of the same. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), DDD's 10-day put/call volume ratio of 0.71 ranks higher than 65% of all similar readings taken in the past year.

This skepticism is witnessed outside of the options pits, as well, with more than 36% of the equity's float sold short. Additionally, two-thirds of covering analysts maintain a "hold" or worse suggestion on the stock, and RBC and Stifel cut their price targets on 3D Systems Corporation (NYSE:DDD) today to $33 and $35, respectively.


 

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