Key insights
- Leerink raised its price target on Twist Bioscience (TWST) to $80 based on revenue growth expectations driven by AI and automation. TWST expects revenue to reach $1 billion by fiscal year 2031. While the stock is up 109% YoY, InvestingPro data suggests it may be overvalued. The report highlights TWST's path to profitability and margin expansion, with cash flow profitability modeled by fiscal 2029. The positive outlook could signal broader investor interest in AI-driven biotech companies.
Investing.com - Leerink raised its price target on Twist Bioscience stock (NASDAQ:TWST) to $80 from $70 while maintaining an Outperform rating. The stock currently trades at $58.84, up 109% over the past year, though InvestingPro analysis suggests the shares are overvalued relative to its Fair Value estimate.
The firm increased its target following the company’s Investor Day, where management outlined expectations for revenue to reach approximately $1 billion by fiscal year 2031, representing a compound annual growth rate exceeding 16%.
Management expects revenue to double by fiscal 2031 from $445 million in fiscal 2026, based on the midpoint of current guidance. The company projects adjusted EBITDA profitability starting in fiscal 2027 and long-term gross margins above 60%. According to InvestingPro data, Twist’s current gross margin stands at 52%, indicating room for improvement toward management’s target. The company remains unprofitable over the last twelve months, one of several key insights available in the comprehensive Pro Research Report covering TWST and 1,400+ US equities.
Leerink noted volume ramp and incremental gross margins of at least 75% support the path to higher margins. The firm highlighted multiple emerging growth areas led by artificial intelligence and investments in automation that enable scaling within the existing footprint.
The firm models cash flow profitability by fiscal 2029, citing ample runway from the current cash balance.
In other recent news, Twist Bioscience reported its second-quarter earnings for fiscal year 2026, highlighting a strong revenue performance. The company achieved total revenues of $111 million, marking a 19% increase compared to the previous year and surpassing the consensus estimate of $108 million. However, the earnings per share (EPS) fell short of expectations, coming in at -$0.71 compared to the forecasted -$0.48. Despite the EPS miss, there was a positive reception in the market, as evidenced by a rise in the company’s stock during pre-market trading.
In response to the revenue beat, TD Cowen adjusted its price target for Twist Bioscience, increasing it from $58 to $68, while maintaining a Buy rating. This move reflects the firm’s confidence in the company’s revenue growth trajectory. These developments come as analysts and investors continue to monitor Twist Bioscience’s financial performance closely.
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