Strength Seen in Ginkgo Bioworks (DNA): Can Its 14.5% Jump Turn into More Strength?

Ginkgo Bioworks Holdings, Inc. (DNA Quick QuoteDNA – Free Report) shares ended the last trading session 14.5% higher at $16.36. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock’s 27.6% gain over the past four weeks.

The sudden soaring of the stock price can be attributed to positive investor expectations regarding the potential of Ginkgo’s proprietary cell programming platforms, Foundry and Codebase. The company offers R&D services utilizing these assets under collaboration and license agreements. DNA also provides end-to-end biomonitoring and bioinformatic support services to public health authorities.

This company is expected to post quarterly loss of $1.45 per share in its upcoming report, which represents a year-over-year change of +59.7%. Revenues are expected to be $45.08 million, up 29.7% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Ginkgo Bioworks, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock’s price usually doesn’t keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on DNA going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here >>>>

Ginkgo Bioworks belongs to the Zacks Medical – Biomedical and Genetics industry. Another stock from the same industry, Krystal Biotech, Inc. (KRYS Quick QuoteKRYS – Free Report) , closed the last trading session 0.7% higher at $162.44. Over the past month, KRYS has returned 1%.

Krystal Biotech’s consensus EPS estimate for the upcoming report has changed +10.6% over the past month to $1.29. Compared to the company’s year-ago EPS, this represents a change of +330%. Krystal Biotech currently boasts a Zacks Rank of #4 (Sell).