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Twist Bioscience Corp (TWST)
NASDAQ:TWST
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Twist Bioscience
(NASDAQ:TWST)
Rating:59Neutral
Price Target:
$34.00
▲(15.61%Upside)
Positive Factors
Financial Performance
Continued gross margin beats give greater confidence in the margin outlook, with gross margin well ahead of expectations.
Market Positioning
Healthcare revenues increased by 29% year over year, driven by higher adoption of products in pharma, biotech, and diagnostic customers.
Operational Efficiency
The highlight of the quarter was the spin-out of the data storage business, now called Atlas Data Storage, which is expected to drive operational expense savings and yield positive adjusted EBITDA.
Negative Factors
Market Environment
There is difficulty for investors to get conviction about the durability of share gains and potential for upside given the challenging Tools and R&D end-market backdrop.
Market Valuation
Shares are trading at approximately 5 times EV/2026 Sales compared to about 3 times for peers, indicating that the growth outlook may already be priced into shares despite end market challenges.
Risk Assessment
The risk/reward profile is viewed as skewed to the downside despite TWST being a market leader in an attractive niche.
Twist Bioscience (TWST) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.69B
Dividend YieldN/A
Average Volume (3M)1.16M
Price to Earnings (P/E)―
Beta (1Y)2.85
Revenue Growth25.30%
EPS Growth2.75%
CountryUS
Employees923
SectorHealthcare
Sector Strength40
IndustryMedical - Diagnostics & Research
Share Statistics
EPS (TTM)-0.66
Shares Outstanding59,916,140
10 Day Avg. Volume1,158,814
30 Day Avg. Volume1,160,992
Financial Highlights & Ratios
PEG Ratio-2.67
Price to Book (P/B)4.44
Price to Sales (P/S)0.00
P/FCF Ratio-29.86
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$47.75Price Target Upside62.36% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
Twist Bioscience Business Overview & Revenue Model
Company DescriptionTwist Bioscience Corporation (TWST) is a biotechnology company that specializes in the production of synthetic DNA using a proprietary silicon-based platform. The company is primarily involved in the sectors of healthcare, agriculture, industrial chemicals, and academic research. Twist Bioscience's core products and services include synthetic genes, next-generation sequencing (NGS) tools, and high-throughput oligo pools, which are used by researchers and companies to innovate across various fields such as drug discovery, biomaterials development, and agricultural advancements.
How the Company Makes MoneyTwist Bioscience generates revenue through the sale of its synthetic DNA products and services. The company's revenue model is largely based on selling custom DNA sequences to customers in diverse industries including pharmaceuticals, biotechnology, agriculture, and academia. Key revenue streams include synthetic genes, NGS tools, and oligo pools. Twist Bioscience also benefits from strategic partnerships and collaborations with other companies and research institutions, which help expand its market reach and enhance its product offerings. Additionally, licensing agreements for its proprietary technology contribute to its earnings. Factors such as advancements in personalized medicine, increased demand for genetic research, and the growing field of synthetic biology significantly bolster the company's revenue potential.
Twist Bioscience Earnings Call Summary
Earnings Call Date:May 05, 2025
(Q2-2025)
| % Change Since: -25.05%|
Next Earnings Date:Aug 01, 2025
Earnings Call Sentiment Positive
The earnings call reflects a positive outlook with record revenue growth, strategic spinout of the DNA data storage segment, and improved gross margins. While there are some market uncertainties particularly in tariffs and NIH funding, the company's strong performance across its main segments and strategic initiatives provide an optimistic view.Q2-2025 Updates
Positive Updates
Record Revenue Growth
Twist Bioscience reported record revenue of $92.8 million for the second quarter of fiscal 2025, an increase of 23% year-over-year and 4.6% sequentially.
DNA Data Storage Spinout
Twist Bioscience has spun out DNA data storage as an independent company, Atlas Data Storage, with a $155 million investment from various partners. Twist retains a 24% equity interest, royalties, and up to $75 million in milestone payments.
Improved Gross Margin
Gross margin improved to 49.6%, up from 41% in the second quarter of fiscal 2024, demonstrating the leverage of fixed costs with higher volume.
Expansion in NGS and SynBio
NGS revenue increased by 25% year-over-year to $51.1 million, and SynBio revenue increased by 21% year-over-year to $36 million.
Strategic Initiatives and Customer Engagement
Introduction of the Twist Wallet and promotional programs for academic customers have resulted in increased customer engagement and new customer acquisition.
Negative Updates
Potential Market Uncertainties
Guidance reflects uncertainties in tariffs and NIH funding, though Twist anticipates continued share gains and market resilience.
Limited Growth in APAC
APAC revenue showed minimal change, remaining at $7 million compared to $7.2 million in the same period of fiscal 2024.
Company Guidance
During the second quarter financial results conference call, Twist Bioscience provided guidance for fiscal 2025, maintaining its total revenue projection of $372 million to $379 million, indicating approximately 20% growth year-over-year at the midpoint. The company reported a record revenue of $92.8 million for the quarter, with a gross margin of 49.6%, surpassing guidance and demonstrating a significant increase from the previous year's 41%. Sequential and year-over-year growth was noted across its segments: SynBio ($36 million, 21% growth), NGS ($51.1 million, 25% growth), and Biopharma services ($5.7 million, 21% growth). For the full fiscal year, Twist anticipates a gross margin of approximately 49.5%, with improvements expected to surpass 50% in the latter half of the year. The company also projects an adjusted EBITDA loss of $48 million to $53 million, with improvements linked to the recent spin-out of its DNA data storage business, Atlas Data Storage. This transaction is expected to positively impact adjusted EBITDA by $5 million per quarter starting in Q4 of fiscal 2025, aiding Twist's accelerated timeline towards adjusted EBITDA breakeven by the end of fiscal 2026.Twist Bioscience Financial Statement Overview
Summary
Twist Bioscience is experiencing robust revenue growth, yet continues to face profitability and cash flow challenges. The balance sheet remains strong with a high equity ratio and low debt utilization, offering some financial stability. Continued focus on improving operational efficiencies and cash flow management will be crucial for long-term profitability.Income Statement
Twist Bioscience has demonstrated strong revenue growth with a TTM revenue increase of 11.09% over the previous annual period. However, the company is facing profitability challenges, with negative net profit and EBIT margins indicating ongoing operating losses. The gross profit margin of 46.7% in the TTM suggests a solid ability to cover direct costs, but the company's net profit margin remains negative at -54.96%.65
Positive
Balance Sheet
The company's balance sheet shows a solid equity position with an equity ratio of 73.91% in the TTM, indicating financial stability and relatively low leverage. The debt-to-equity ratio is manageable at 0.18, suggesting conservative use of debt. However, the negative ROE at -43.42% highlights the inability to generate profit from equity capital currently.70
Positive
Cash Flow
Cash flow analysis reveals a challenging situation with negative operating and free cash flows over the recent periods. The TTM free cash flow to net income ratio and operating cash flow to net income ratio are not favorable, indicating inefficiencies in converting income to cash. However, there is a slight improvement in free cash flow, which is a positive sign.60
Neutral
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 347.68M | 312.97M | 245.11M | 203.56M | 132.33M | 90.10M | Gross Profit |
| 162.37M | 133.35M | 89.73M | 84.23M | 51.71M | 28.69M | EBIT |
| -201.17M | -220.83M | -217.16M | -249.02M | -153.26M | -117.58M | EBITDA |
| -176.51M | -176.71M | -174.15M | -191.55M | -143.91M | -132.09M | Net Income Common Stockholders |
| -191.15M | -208.73M | -204.62M | -217.86M | -152.10M | -139.93M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 387.66M | 276.40M | 336.41M | 504.97M | 477.86M | 290.00M | Total Assets |
| 853.92M | 614.32M | 776.40M | 961.38M | 702.10M | 398.88M | Total Debt |
| 91.22M | 85.03M | 94.07M | 94.91M | 62.92M | 35.98M | Net Debt |
| -223.98M | -141.29M | -192.40M | -283.77M | -402.91M | -57.69M | Total Liabilities |
| 149.99M | 141.63M | 152.97M | 171.99M | 121.28M | 62.62M | Stockholders Equity |
| 703.93M | 472.69M | 623.43M | 789.38M | 580.82M | 336.26M |
| Cash Flow | Free Cash Flow | ||||
| -65.49M | -69.17M | -170.25M | -226.24M | -139.31M | -152.12M | Operating Cash Flow |
| -56.11M | -64.09M | -142.47M | -124.39M | -112.24M | -142.25M | Investing Cash Flow |
| -4.96M | -3.07M | 50.61M | -232.93M | 156.16M | -114.65M | Financing Cash Flow |
| 27.68M | 6.89M | 911.00K | 270.53M | 329.18M | 303.73M |
Twist Bioscience Technical Analysis
Negative
29.41
Price Trends
36.71
Negative
41.23
Negative
42.99
Negative
Market Momentum
-2.45
Positive
38.16
Neutral
21.89
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TWST, the sentiment is Negative. The current price of 29.41 is below the 20-day moving average (MA) of 32.56, below the 50-day MA of 36.71, and below the 200-day MA of 42.99, indicating a bearish trend. The MACD of -2.45 indicates Positive momentum. The RSI at 38.16 is Neutral, neither overbought nor oversold. The STOCH value of 21.89 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TWST.
Twist Bioscience Risk Analysis
Twist Bioscience disclosed 60 risk factors in its most recent earnings report. Twist Bioscience reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Twist Bioscience Peers Comparison
Overall Rating
UnderperformOutperform
Sector (53)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $3.45B | 140.42 | 5.88% | ― | 2.78% | -54.72% | |
66 Neutral | $1.45B | ― | -62.22% | ― | 30.47% | -26.63% | |
61 Neutral | $10.74B | ― | -36.89% | ― | 11.57% | -315.25% | |
59 Neutral | $1.69B | ― | -38.22% | ― | 25.30% | 2.75% | |
53 Neutral | $5.14B | 3.23 | -45.01% | 2.85% | 17.55% | -0.69% | |
52 Neutral | $4.71B | ― | -4584.47% | ― | 28.20% | 13.87% | |
49 Neutral | $12.72B | ― | -23.82% | ― | -3.47% | 25.55% |
* Healthcare Sector Average
Performance Comparison
TWST
Twist Bioscience
29.41
-13.03
-30.70%
EXAS
Exact Sciences
56.56
9.54
20.29%
ILMN
Illumina
82.49
-19.58
-19.18%
GH
Guardant Health
39.17
13.01
49.73%
SHC
Sotera Health
12.43
1.39
12.59%
GRAL
GRAIL Inc
42.34
28.04
196.08%
Twist Bioscience Corporate Events
Private Placements and FinancingBusiness Operations and StrategyFinancial Disclosures
Twist Bioscience Spins Out DNA Storage Unit
Positive
May 5, 2025
On May 2, 2025, Twist Bioscience Corporation completed a Contribution Agreement with Atlas Data Storage, Inc., securing $155 million in investments by spinning out its DNA data storage product group into an independent company, Atlas Data Storage. This strategic move allows Twist to focus on its core operations while maintaining a stake in the new entity, benefiting from future milestones and royalties. Twist reported record revenue of $92.8 million for the second quarter of fiscal 2025, marking a 23% increase from the previous year, and improved its gross margin to 49.6%. The company expects to achieve adjusted EBITDA breakeven by the end of fiscal 2026, driven by continued growth and innovation.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.