3D Systems: Healthcare & Metal Pivot Drives Re-Rating

We initiate on DDD with a Strong Buy rating and $4 PT. 3D Systems (DDD) provides end-to-end AM and

digital manufacturing capabilities — across hardware, materials, and proprietary software — spanning healthcare, dental, aerospace, and biotech. While investors remain fixated on sluggish topline growth and continued Geomagic headwinds, two high-value verticals — metal additive and healthcare — are altering DDD’s narrative and provide structural upside the market discounts. Our model reflects a conservative year ahead as $25–30m annualized Geomagic revenue washes out and capex inertia tempers through the presidential election, but the setup into FY26 is anomalous. Mgmt’s $70m cost reset and improved capital discipline from $123m cash in Geomagic disposal opens room for margin stabilization as future verticals take hold. Our 1.0x FY26E EV/S (still at a discount to peer median of 1.41x) serves to anchor the story and reflects execution haircuts, but also captures 7% rev inflection as healthcare and aerospace launches ramp & FDA-cleared NextDent 300 platform ramps. Despite not ignoring execution and supply chain risk, we believe an underweight consensus on DDD’s differentiated lease of healthcare leaves asymmetric upside intact. With cost base reset, infrastructure built, and rev catalysts crested, we see risk skewed to the patient investor in the face of uncertain macro.

## Markets Overlook Reset
We strongly believe the 3D healthcare and dental expansion is a catalyst unrecognized by the market,

based on demonstrable momentum across both personalized medicine and digital dentistry verticals, which enjoy structural growth beyond capital spend cycles. In 2024, personalized healthcare and