10 Most Promising Gene Editing Stocks to Buy According to Hedge Funds

2. Ginkgo Bioworks Holdings, Inc. (NSYE:DNA)

Number of Hedge Fund Holders: 32

Average Upside: 80.18%

Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) is a biotechnology company that develops a platform for cell programming, addressing challenges across various industries. The company has bolstered its capabilities in genetic diagnostics, AI-driven compounds, and drug discovery by acquiring three molecular medicine startups: Proof Diagnostics, Patch Biosciences, and Reverie Labs.

Earlier this February, Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) acquired Proof Diagnostics, a biotech startup leveraging gene editing tools to develop diagnostic tests. A key asset in this acquisition is Proof’s library of DNA-cutting enzymes, known as OMEGAs, that can be used in gene editing experiments. This purchase aligns with Ginkgo’s strategy to build technology platforms that other biotech companies can use to create genetic medicines. Similarly, Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) acquired StrideBio back in 2023, gaining access to technology for discovering and engineering capsids to deliver complex therapies. The company also collaborates with Arbor Biotechnologies on precise editing tools.

The company has had a not-so-stellar quarter, reporting a 20% year-over-year decline in cell engineering revenue to $36 million, while biosecurity revenue remained steady at $20 million. Nevertheless, Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) maintained its full-year guidance, projecting cell engineering revenue between $120 million and $140 million.

Additionally, TD Cowen remains optimistic about Ginkgo Bioworks Holdings, Inc. (NYSE:DNA), raising its price target from $3 to $10 and reaffirming a Buy rating. This upgrade follows the launch of Ginkgo’s new Datapoints portfolio, which aims to improve its model training capabilities, a crucial element in expanding its tools franchise.

As of Q2, 32 hedge funds held long positions in Ginkgo Bioworks Holdings, Inc. (NYSE:DNA), with total stakes valued at $114.2 million.