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Zymergen: How To Buy A Disaster

Ahan Analytics profile picture
Ahan Analytics


  • Shares in Biofacturing company Zymergen (ZY) collapsed in epic fashion after a catastrophic setback in its commercialization plans.
  • The stock is now significantly de-risked and worthy of speculation.
  • I am considering a bet on the company's cash position, new management, and promising technology.
Opportunity Crisis Concept
ogichobanov/iStock via Getty Images

Biofacturing company Zymergen (ZY) collapsed in epic fashion less than 4 months after its IPO after the company. An abrupt admission catalyzed the disaster. Zymergen admitted in a business update that “issues with its commercial product pipeline…will impact

This article was written by

Ahan Analytics profile picture
Dr. Duru has blogged about financial markets since the year 2000. A veteran of the dot-com bubble and bust, the financial crisis, and the coronavirus pandemic, he fully appreciates the value in trading and investing around the extremes of market behavior. In this spirit, his blog "One-Twenty Two" (https://drduru.com/onetwentytwo/) delivers a different narrative for students and fans of financial markets. Dr. Duru challenges conventional market wisdoms and offers unique perspectives. The blog posts cover stocks, options, currencies, Bitcoin, and more, while leveraging the tools of both technical and fundamental analysis for short-term and long-term trading and investing. Some of these ideas and analyses are also featured here on Seeking Alpha.Dr. Duru received a B.S. in Mechanical Engineering (and an honors degree in Values, Technology, Science and Society - now simply STS) from Stanford University. For graduate studies, Dr. Duru went on to earn a Ph.D. in Engineering-Economic Systems (now Management, Science, and Society). Dr. Duru's work experiences include:*Independent consulting in operations research and decision analysis*Management consulting in product development and technology strategy*Price optimization software for computer manufacturers and internet advertising (including a shared patent for methodology)*Business Intelligence and Data Analytics, including some Data Science and Data EngineeringConsulting practice: https://ahan-analytics.drduru.com/

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in ZY over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (22)

Curve Tech Investing profile picture
Anyone considering an investment in ZY needs to understand the Intrexon story, in case history is repeating itself. Think about who were the winners and who were the losers in that case. Here's a good place to start:



"This isn't synthetic biology, it's biofacturing." LMAO.
Anyone who spends even just 5 minutes looking at the Zymergen website SHOULD quickly become aware that this company is NOTHING but a Theranos redux.

For all their CLAIMS of "naturally-derived, bioactive ingredients for sustainable consumer care products," NOWHERE do they offer evidence that their "product" in ANY way meets that criteria.

Indeed, the ONLY description that they provide is that it is some sort of polyimide -- aka PLASTIC. And so far ALL they have a FILM that can be used to cover stuff.

This company has SCAM written all over it.
@CitronSource This looks like a comment from a person who spend 3 minutes of "due diligence". Before calling a company "scam", invest a bit (a lot) more in due diligence. Maybe go deep in their extensive list of patents patents.google.com/...
@Moreels "This looks..."???

I repeat that the company's website is NOTHING but pure FLUFF. The entire thing looks like it was written by some advertising agency.

And how many packs of chewing gum can you buy with a "patent"? Indeed, has ANYONE else on the PLANET expressed ANY interest in ANY of the patents?
bluescorpion0 profile picture
@CitronSource the new ceo co-founded Illumina. Not something to take lightly. Also the pivot to pharma enzyme discovery is a good one. Look at $CDXS it is now $40/share from under $15 a little while ago on this alone.
Heading back to new lows shortly. Probably will just sit there. Not more than a day traders stock for now.
howarddork profile picture
If they have no potential events in the next 2 years to move the share price, it's a pretty good bet that you'll be able to get it cheaper next year. Probably by a lot.
Ahan Analytics profile picture
@howarddork - I will be waiting then with open arms! Dependent on the latest news of course....
If it doesn't, that's OK, but I believe it will revisit this week's low. I might buy it then. But if I never own it, that's OK too. ZY doesn't get me all excited.
Wurlitzer profile picture
After looking at ZY for a short time, I was close to buying when it imploded. Now that the price is low and technology remains sound, I will start using my mad money to build a position.
TruffelPig profile picture
@Wurlitzer Sound?? What is sound here??
Egidio24 profile picture
Did you see their borrowing / debt?
Some big pockets have some big holes this week.
If we get a correction, which many believe we are due, there may be some moss growing while waiting for income delivery.
ITSOVERNOW profile picture
i just added you to my list
Great trade Dr. Duru- thanks for this trade( I bought and sold pre and post open) and thanks for your professional, sophisticated insights in general. Hoping you write in more often.
I can wait. Lots of times these train wrecks suffer a second drop. That may be better time. Need to flush even the day traders.
Ahan Analytics profile picture
@InvestorMan Sr. I hear you. It's just hard to predict those things, so I put buying rules in place so I make sure to have something in play for the longer-term thesis to play out.
Good points. With this kind of companies it is Long or nothing
Ahan Analytics profile picture
@Woutmoreels Yes. Boom or bust.
I was hoping there'd be an article on ZY this AM. Thanks for your work!
Ahan Analytics profile picture
@dat_commentator7 Thanks! Looks like I should have written it before the market closed yesterday! Apparently Kathy Wood loaded up. So now my strategy changes a bit. I bought just a few shares at $12 for a "no regret" position (I hate buying right at the $12 optimistic target), and now I cross my fingers for a pullback to buy a lot more shares.
TruffelPig profile picture
@Duru Ark didn't buy a single share today. Not 1. 0.
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