Could more partnerships mean more value?

Ginkgo Bioworks, headquartered in Boston (DNA) develops platforms for cell programming for use 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. It may sound like science fiction, but Ginkgo Bioworks seeks to make it a reality. Ginkgo Bioworks started in 2008 and has come a long way since the company built its “first lab with equipment pulled from MIT dumpsters”.

Today, Ginkgo Bioworks’ mission is to make biology easier to design. It’s a tall order, and the company’s stakeholders cannot expect Ginkgo Bioworks to achieve its goals alone.

Fortunately, the company is pursuing several value-added partnerships. Recent press releases indicate that Ginkgo Bioworks isn’t afraid to work with other companies in pursuit of potentially breakthrough science.

Stock-wise, DNA is very affordable (less than $4 per share) and represents one of the very few investable pure players in the specific field of cellular programming. So, are you ready to embark on a future-oriented investment in cellular engineering technology?

The strongest position

Ginkgo Bioworks is certainly among the most interesting biotech companies you can invest in today. But let’s not rush. It’s important to make sure you’re investing in a financially sound business first and foremost.

When you put the microscope on the numbers, it’s undeniable that Ginkgo Bioworks is firing on all cylinders. Company co-founder and CEO Jason Kelly said Ginkgo Bioworks is “in the strongest position we’ve ever had as a company,” and the tax stats back up his claim.

First, Ginkgo Bioworks added 10 new cell programs to the company’s Foundry platform during the fourth quarter of 2021. This brings the total to 31 new programs in 2021, a growth of 72% over 2020.

Undoubtedly, the increase in the number of new cell programs contributed to the financial success of Ginkgo Bioworks during the fourth quarter of 2021. During this period, the company managed to increase its revenues year on year. another 363%, to $148 million.

Q4 wasn’t just a fluke either. For fiscal 2021, Ginkgo Bioworks achieved total revenue of $314 million, marking a 309% year-over-year increase. Clearly, the science of cell programming can be a remarkably lucrative field of endeavour.

Will Ginkgo Bioworks be able to continue its growth in 2022? The answer should be yes, as the company plans to add 60 new cell programs to its Foundry platform this year. With that in mind, Ginkgo Bioworks predicts total 2022 revenue to be between $325 million and $340 million, which isn’t too shabby.

Three partnerships to consider

As mentioned above, partnerships can help Ginkgo Bioworks pursue its ambitious goals in the science of cell programming. You may be surprised, however, to find out how many collaborations Ginkgo Bioworks has pursued lately.

It may seem hard to believe, but in less than two weeks, Ginkgo Bioworks released press releases announcing three different partnerships. Is it possible for a company to engage in too much collaborative effort?

Perhaps. Ginkgo Bioworks might be spreading too thinly – or maybe not. Sophisticated investors should consider each partnership separately and assess their potential contributions to Ginkgo Bioworks’ bottom line.

Don’t worry, I’m happy to provide you with a summary of what Ginkgo Bioworks has been up to recently and who 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 advances in human microbiome science to help treat major chronic diseases.

Shortly after, Ginkgo Bioworks revealed an agreement with water quality platform company FREDsense Technologies Corp. These two companies will build biosensors for water quality monitoring and detection. With the help of this partnership, Ginkgo seeks to construct four different microbial strain biosensors. Hopefully the result will be a quick and accurate test for water contaminants and other threats.

In addition to all of this, Ginkgo Bioworks plans to work with Light Bio, Inc., which creates bioluminescent plants for homes and gardens. Through the agreement, Ginkgo Bioworks seeks to “help improve luminescent yield and enzyme efficiency in Light Bio’s luminous ornamentals,” according to the press release.

Perhaps Ginkgo’s cell engineering abilities can help advance plant luminescence and, therefore, efficient plant growth.

The Taking of Wall Street

As far as Wall Street is concerned, the ADN stock is in the form of a moderate buy based on three buy ratings and two hold ratings. Ginkgo Bioworks’ average price target is $7.63, implying an upside potential of 107.6%.

Takeaway meals

Does “more” mean “better” when it comes to business partnerships? We discovered three collaborations from Ginkgo Bioworks in April, and the month isn’t even over yet.

The answer is, “more” is not the same as “better”, however, Ginkgo Bioworks seems to be pursuing intriguing and potentially lucrative business opportunities through its collaborations.

Additionally, we have seen that Ginkgo Bioworks’ financial progress has been impressive. Therefore, you might consider a position in DNA stock as a long-term investment in the pursuit of cell programming technology.

Discover new investment ideas with reliable data.

Read the full disclaimer and disclosure