NEW YORK (TheStreet) -- The 3-D printing space is rapidly changing industries, as more companies begin to realize the benefits of making their own parts, cutting costs, and expanding into new fields. Stratasys
(SSYS - Get Report) is the "behemoth" in the 3-d printing industry and it's only poised to get bigger, according to one analyst.
Deutsche Bank analyst Sherri Scribner initiated coverage on Stratasys with a "buy" rating and a $140 price target, noting that Stratasys' leading technology is helping the company take a lead over its competitors, including 3-D Systems (DDD - Get Report) and ExOne (XONE - Get Report). "We expect Stratasys to continue to benefit from the growth in the nascent additive manufacturing market, driven by is leading position in FDM (fused deposition modeling, one of the most cost-effective technologies available today," Scribner wrote in a note.
She noted that Stratasys, which recently bought Object and Makerbot earlier this year, has the highest gross margins in the industry, and "has room to return operating margins back to historical levels as it improves services margins."
Shares of Stratasys were higher in premarket trading on Tuesday, up 0.71% to $118.50.
Though the Makerbot acquisition put Stratasys more in line with consumers, as the industry just starts to come into people's homes, Scribner noted the Object merger may help strengthen Stratasys' lead in other areas. "With the recent merger with Objet, Stratasys has cemented its lead as the largest shipper of industrial 3-D printing units in the world," she wrote in the report.
The additive manufacturing market has been growing like a weed over the past 20 years, expanding at a compound annual growth rate (CAGR) of 18%. But it's only been the past few years when the industry has really started to take off as the media and investors begin to take notice. Over the past three years, revenue from 3-D printing has more than doubled to $2.2 billion, and it's only poised to continue to grow, Scribner noted.