Ginkgo downgraded at William Blair citing concerns on outlook
franckreporter
- Even after recording better-than-expected Q1 2023 revenue, Ginkgo Bioworks (NYSE:DNA) trended lower on Thursday morning as William Blair downgraded the cell platform company flagging concerns on its newly-reaffirmed outlook.
- With its quarterly financials on Wednesday, Ginkgo (DNA) reiterated its forecast to add 100 new Cell Programs to the Foundry platform in 2023, which, according to William Blair analyst Matt Larew, could be challenging.
- Downgrading the stock to Market Perform from Outperform, the analyst argues that guidance implies DNA must add 29 programs per quarter to achieve it, despite its record of 14 new additions over the past six quarters on average.
- "Given the challenging macro backdrop and indications of longer sales cycles and cautious spending, we do not have confidence that the company will hit its target this year," Larew wrote, arguing that it could set DNA's Cell Engineering revenue below expectations without a ramp up in royalties.