3D Printing: Still Worth It?

This article originally appeared on Motif Investing.

While 3D printing was once hailed as being part of a new industrial revolution, investing in the 3D printing industry has been a lot like riding a nauseating roller coaster for investors. Over the past five years, stocks for Stratasys and 3D Systems—the two biggest names in the 3D printing sector—have skyrocketed then fell. 3D Systems shot up more than 600 percent in three years, then fell to a four-year low last year, but is back up again now.

3D printing, otherwise known as additive manufacturing, is the technology that allows a machine to produce a three-dimensional object by layering successive layers of material. A variety of raw materials can be used in the process including plastic, ceramic, glass and precious metals. The technology is now making inroads in a number of industries including confectionery, automotive, aerospace, and defense, education and healthcare.

And there is no doubt that the technology will continue to thrive. The worldwide 3D printing industry is projected to grow to from $7.3 billion in 2016 to $12.7 billion in 2018, and $21.2 billion in 2020, according to Wohlers Associates, who are considered experts in the 3D-printing market research.

While Stratasys and 3D Systems were the hottest stocks in the 3D printing industry at one point, HP might have been partially responsible for the sudden valuation decrease of these company’s stocks. When the 2D printing giant introduced its Fusion Jet industrial 3D printer in 2015 and formed partnerships with many top-tier partners, including Nike Inc NKE and BAYER MOTOREN WERK ADR EACH REPR 0.33333 SHS BMWYY, Hewlett Packard Enterprise Co HPE was seen as a substantial threat to 3D printing marketing share. HP claims its 3D printers, which print in polymers, are 10 times as fast and twice as cost efficient as other 3D printers.

Some analysts believe HP’s inroads into the 3D printing space made buyers more hesitant to purchase 3D printers in order to see how the technology evolves. While HP will get far more revenue from sales of its traditional 2D printers and PCs, it could become a major player in the 3D printing world in the near future.

If you don’t have the stomach for investing in companies focused on 3D printers, here are some other investment areas in the 3D printing space worth looking at.

Service-based 3D printing is doing well

3D printing services is another aspect of the 3D printing market that is seen as having substantial growth. While some in the 3D printing market have struggled, Proto Labs Inc PRLB has done quite well and is profitable. ProtoLabs is a quick-turn manufacturer and 3D printing service provider, who doesn’t rely on customers buying equipment and then refilling material continuously, like other 3D printing companies. By operating a full service-based 3D printing company, Proto Labs has a notable competitive edge over 3D printing hardware manufacturers.

3D Designers seek 3D printing software

Another aspect of 3D printing that is expected to do quite well is 3D printing software. As more companies begin to use 3D printing technology, designers will use 3D design-oriented software. Autodesk, Inc. ADSK, which creates premier software for engineers and architects, has also made headways with 3D printing software. It helps also that Autodesk created its own open-source Ember printer, which not only benefits the industry but the company’s market share. Since Autodesk is widely diversified, it hasn’t suffered the volatility of other 3D printing companies. Another 3D software company to watch is Dassault Systemes SE (ADR) DASTY, which have been adding new functions to their CAD software packages that make 3D printing easier.

Automotive and Aerospace look for metal 3D printing

If investing directly into 3D printer manufacturers feels unsafe at the moment, investors can also look to metal 3D printing. The process has been used in high-profile projects like the SpaceX Falcon 9 rocket engine. Major companies including AIRBUS UNSPON ADR EA REPR 0.25 ORD EADSY, General Electric Company GE, and Boeing Co BA have made significant investments in metal 3D printing. When this process becomes more integrated into automotive and aerospace projects, it will only see more demand in the coming years.

Materials for 3D printing will grow

There may be a few hundred materials for 3D printing materials, but traditional manufacturing has tens of thousands. Which means materials in 3D printing industry will continue to expand and may explode in the near future. EOS E-Manufacturing Solutions is a company to watch in this space.