Boston-headquartered Ginkgo Bioworks (DNA) develops platforms for cell programming to be used in food and agriculture, industrial chemicals, pharmaceuticals, and other applications. I am bullish on the stock.
Imagine being able to program cells as easily as some people can program a computer. This might sound like science fiction, but Ginkgo Bioworks is seeking to make this a reality. Ginkgo Bioworks started in 2008 and has come a long way since the company built its “first lab with equipment foraged out of MIT dumpsters.”
Today, Ginkgo Bioworks’ mission is to make biology easier to engineer. That’s a tall order, and the company’s stakeholders can’t possibly expect Ginkgo Bioworks to achieve its objectives alone.
Thankfully, the company is pursuing several value-added partnerships. Recent press releases indicate that Ginkgo Bioworks is not afraid to work with other businesses in pursuit of potentially game-changing science.
As for the stock, DNA is highly affordable (less than $4 per share) and represents one of a very small number of investable pure plays in the specific field of cell programming. So, are you ready to delve into a future-facing investment in cell-engineering technology?
The Strongest Position
Certainly, Ginkgo Bioworks is among the most exciting biotechnology businesses you can invest in today. Let’s not get ahead of ourselves, though. It’s important to make sure that you’re investing in a financially sound business, first and foremost.
When we put the microscope on the numbers, it’s undeniable that Ginkgo Bioworks is firing on all cylinders. The company’s co-founder and CEO, Jason Kelly, declared that Ginkgo Bioworks is “in the strongest position that we’ve ever been in as a company,” and the fiscal stats support his contention.
First of all, Ginkgo Bioworks added 10 new cell programs to the company’s Foundry platform during the fourth quarter of 2021. That brings the total to 31 new programs in 2021, signifying 72% growth compared to 2020.
Without a doubt, expanding the number of new cell programs contributed to Ginkgo Bioworks’ financial success during 2021’s fourth quarter. In that time frame, the company managed to increase its revenue year-over-year by a whopping 363%, to $148 million.
Q4 wasn’t just a fluke, either. For Fiscal 2021, Ginkgo Bioworks pulled in total revenue of $314 million, marking a year-over-year increase of 309%. Clearly, cell-programming science can be a remarkably lucrative field of business.
Will Ginkgo Bioworks be able to keep growing in 2022? The answer should be yes, as the company expects to add 60 new cell programs to its Foundry platform this year. With that in mind, Ginkgo Bioworks anticipates total 2022 revenue to land in a range of $325 million to $340 million – not too shabby.
Three Partnerships to Consider
As was mentioned above, partnerships can help Ginkgo Bioworks pursue its ambitious objectives in cell-programming science. You may be astounded, however, to discover how many collaborations Ginkgo Bioworks has pursued lately.
This might sound hard to believe, but in less than two weeks’ time, Ginkgo Bioworks issued press releases announcing three different partnerships. Is it possible for a company to engage in too many collaborative efforts?
Maybe. Ginkgo Bioworks could be spreading itself too thin – or maybe not. Informed investors should consider each partnership separately and evaluate their potential contributions to Ginkgo Bioworks’ bottom line.
Don’t worry, I’m glad to provide a summary of what Ginkgo Bioworks has been up to lately and whom the company will be working with in the near future.
Mastering the Science of Collaborations
Earlier this month, Ginkgo Bioworks announced a partnership with precision microbiome science company Microba Life Sciences. Together, they will work to identify single-strain, live-bacteria product candidates against autoimmune diseases. It will be interesting to see how the two companies leverage advancements in human microbiome science to help treat major chronic diseases.
Not long afterward, Ginkgo Bioworks disclosed an agreement with water-quality platform company FREDsense Technologies Corp. These two businesses will build biosensors for water-quality monitoring and detection. With the help of this partnership, Ginkgo seeks to build four different microbial strain biosensors. Hopefully, the result will be rapid and accurate testing for water contaminants and other threats.
On top of all that, Ginkgo Bioworks plans to work with Light Bio, Inc., which creates bioluminescent plants for homes and gardens. Through this agreement, Ginkgo Bioworks seeks to “help improve the luminescent output and efficiency of the enzymes within Light Bio’s glowing ornamental plants,” according to the press release.
Perhaps Ginkgo’s cell-engineering capabilities can contribute to advancements in plant luminescence and hence, efficient plant growth.
Wall Street’s Take
Turning to Wall Street, DNA stock comes in as a Moderate Buy based on three Buys and two Hold ratings. The average Ginkgo Bioworks price target is $7.63, implying 107.6% upside potential.
The Takeaway
Is “more” the same as “better” when it comes to business partnerships? We’ve discovered three of Ginkgo Bioworks’ collaborations in April, and the month isn’t even finished yet.
The answer is, “more” isn’t the same as “better,” – however, Ginkgo Bioworks appears to be pursuing intriguing and potentially lucrative business opportunities through its collaborations.
Moreover, we’ve found that Ginkgo Bioworks’ financial progress has been impressive. Therefore, you could consider a position in DNA stock as a long-term investment in the pursuit of cell-programming technology.
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