Cantor Fitzgerald analyst Troy Jensen initiated coverage on Proto Labs, Inc. (NYSE:PRLB) with an Overweight rating and price target of $44.00.

The analyst writes that the company is well-placed to capitalize on a growing market and capture increased growth in production applications. With its hybrid business model offering in-house manufacturing and a network of suppliers, Proto Labs stands out in the digital manufacturing market, says the analyst.

Proto Labs is primed to benefit from the ongoing shift towards digital manufacturing, and its entirely digital end-to-end manufacturing service resonates with customers, offering a wide range of capabilities, says the analyst.

The analyst expects pent-up industry demand led by improving economic conditions and factors like declining interest rates and a more favorable economic environment are expected to drive growth reacceleration in the digital manufacturing sector.

The analyst notes that Proto Labs' near-term focus on growing revenues and expanding margins should benefit PRLB shares.

The analyst's industry survey indicates a promising outlook for 2024, with around 91% of service bureaus expecting year-over-year revenue growth.

The analyst estimates EPS of $1.50 in FY24 and $1.71 in FY25.

Investors can gain exposure to the stock via 3D Printing (The) ETF (BATS:PRNT) and Pacer BlueStar Engineering The Future ETF (NASDAQ:BULD).

Also Read: Proto Labs Scores First-Quarter Beat, Fueled By Order Growth, Higher-Margin Factory Business

Price Action: PRLB shares are up 4.95% at $31.82 at the last check Wednesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.