The amount of hype around 3D printing stocks right now is impressive. Indeed, growth investors are looking for companies with cutting-edge breakthrough technologies. Accordingly, it’s clear why Nano Dimension (NNDM) has received so much attention of late.

The company’s ability to enhance portfolio returns for investors relies on the belief that 3D printing companies provide a pathway to incredible growth. Such a determination is up to individual investors to make.

However, there are certainly reasons why Nano Dimension is a top stock among growth enthusiasts today. Let’s dive into some of the reasons why this stock is on so many watch lists right now. (See Nano Dimension stock charts on TipRanks)

Investors Betting on Business Model with NNDM Stock

Indeed, the ability to enhance the prototyping and manufacturing of highly complex electronics using additive manufacturing processes makes for an interesting long-term investment thesis in such stocks.

Manufacturing in the electronics industry is continuously seeing technological advancements. Indeed, investors in NNDM have a reason to gravitate towards the company’s DragonFly LDM 3D printing system. This system is touted as the “world’s first and only precision system that produces professional multilayer PCBs.” Through the use of non-conductive and dielectric inks, Nano Dimension has found a proprietary way of printing multilayer printed circuit boards (PCBs) with impressive resolutions.

What this means for investors is a rather large potential market opportunity. The global market for printed circuit boards is expected to hit $69.5 billion by 2024. Assuming Nano Dimension will be able to capture a significant chunk of market share by 2024, perhaps investors can justify the company’s current $1.7 billion valuation. After all, it could be argued that Nano Dimension only needs to secure a slice of this large and rapidly-growing pie to do so.

Bears will argue that Nano Dimension is a company that’s still having trouble breaking $1 million in sales per month. In fact, over the past year, the company hasn’t been able to do so. The company has only been able to find buyers for 61 of its proprietary systems over the past three years, marking a rather slower ramp up to growth as many would expect to see.

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That said, bulls see long-term growth potential as the real reason to own this stock. Sure, near-term success hasn’t yet been achieved. However, given the valuations of other early-stage innovative companies, perhaps an exception can be made for Nano Dimension, given the quality and potential market its technology provides.

Meme Stock Status Dwindling

One of the key factors underpinning the rapid rise we saw in NNDM stock earlier this year was related to the company’s targeting by retail investors betting on a short-squeeze. Nano Dimension is a company which has maintained a relatively high short volume ratio. Currently, approximately 16% of the company’s outstanding float is sold short.

For investors seeking stocks with the potential to participate in the next meme stock surge higher, NNDM stock has become a favorite this year. However, with the broader index of “meme stocks” selling off substantially of late, perhaps this trade is over. A recent report this past week noted that among the broader index of meme stocks tracked by Investor’s Business Daily, approximately 50% of this year’s gains have been lost, to date. That’s a lot.

Now, buying any stock with lottery ticket-like upside may make sense in a red-hot market with tons of momentum. However, in today’s market, it’s unsurprising to see these momentum plays fall harder than the broader markets on down days, and provide less-than-stellar gains on up days. Investors appear to be in the mood for high-quality, blue-chip technology stocks right now, as a move toward companies providing better risk-adjusted returns takes hold.

Wall Street Weighs in on NNDM Stock

According to TipRanks’ Smart Score, which represents a compilation of sentiments about the stock, Nano Dimension earns a 4, or Neutral, rating. That means the stock is likely to perform inline with overall market performance.

Nano Dimension stock analysisBottom Line

Nano Dimension is a company with an intriguing technology and a market opportunity that is as vast as it is impressive. Indeed, bulls have a reason to buy and hold this speculative tech name over the long-term.

However, this is a stock that really ought to be bought by those individuals that can handle the volatility that’s likely to arise over time. As with any high-priced speculative tech play, high levels of volatility can be expected. Investors need to remember that such investments can lose a tremendous amount of value in the short-term, while providing greater upside in speculative bull markets.

Accordingly, this is a stock that fits a specific investor profile. Those seeking to add some risk to their portfolio can certainly do so with NNDM stock. However, for conservative long-term investors, standing pat on the sidelines may make more sense.

Disclosure: Chris MacDonald held no position in any of the stocks mentioned in this article at the time of publication.

Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.