The moat so far: (i) Arcam owns EB powder additive technology patents, (ii) they are vertically organized as they also produce Ti-Al powders, (iii) they produce the highest quality Ti-Al powders, (iv) Tesera gained FDA approval for an EBM produced orthopedic, and (v) GE's, Avio Areo's, Parker's, and Honeywell's use of Arcam equipment in Aerospace.
The seachange that's occurring is the increasingly deep moat and recognition that EB printed aerospace parts will be adopted by companies that formerly dismissed the idea. Formerly, we were hearing folk say it's a great prototyping technology. Now we're hearing people say it's an economically viable way of producing superior parts for aerospace and prosthetics. Rolls Royce and I believe Pratt and Whitney not long ago asserted that 3d additive manufacturing of aerospace parts wasn't a current and viable means of production but was a technology worthy of consideration by 2025 or 2030 (or so). Now both are adopting the technology, to what extent, I don't know. I'll worry about the links later, got to go soon.
Arcam reminds me of a company I invested some money in back in the naughts, a producer of LED traffic lights. They were focused on a product nobody else produced at the time and were traded on the relatively low volume Chicago exchange. Price swings aside, they were eventually bought out at double my investment. I forgot the symbol.
I doubt Arcam's fate will be precisely the same because unlike LED's, which became a commodity produced by competing companies, EBM has a healthier patent, certification, and technology moat. Instead we have a path for production of precisely engineered parts that are uniquely qualified for use due to Arcam's method, EBM.
LED traffic light producers saw a very narrow field of application but Arcam's field is not so narrow nor so well defined. Well, it's well defined for orthopedics and aerospace, but it's not well defined for other metals that are being explored. So at a minimum, with some years, I expect the same result as for that for the LED company, at a maximum, much more. Risks to at least a doubling in the years ahead include: stock dilution to pay for expansion (equal chances), that the FAA does not certify TiAl parts for turbine blades (very unlikely), or that any technology competes with Arcam on orthopedic or turbine blade front (unlikely up to 2020).
