Investors can learn a lot by observing how corporate insiders handle positions in their own companies. There are many reasons insiders may sell shares, such as buying a house, paying for college, or estate planning. Yet, they generally buy shares for only one reason: they believe they will make more money.
Often, one of the largest and best-informed shareholders in any company is the chief executive officer. Let’s see whether Ginkgo Bioworks Holdings Inc. (NYSE: DNA) CEO Jason Kelly has been increasing or decreasing his share count over the past year and whether he knows something we don’t.
What You Need to Know About Ginkgo Bioworks
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Ginkgo Bioworks develops platform for cell programming. Its platform is used to program cells to enable biological production of products, such as novel therapeutics, food ingredients, and chemicals derived from petroleum. The company serves various end markets, including specialty chemicals, agriculture, food, consumer products, and pharmaceuticals. (These 25 American industries are booming.)
The biotechnology company was founded in 2008 and is headquartered in Boston, Massachusetts. That is also home to American Tower Corp. (NYSE: AMT), DraftKings Inc. (NASDAQ: DKNG), and General Electric Co. (NYSE: GE). Competitors of Ginkgo Bioworks include CRISPR Therapeutics AG (NASDAQ: CRSP) and Editas Medicine Inc. (NASDAQ: EDIT). Kelly has been chief executive at Ginkgo Bioworks since he co-founded it in 2008.
The company posted annual revenue of about $315.0 million and has a market capitalization near $2.8 billion. Shares hit a 52-week low of $1.12 last month and were last seen down about 16% year to date but less than 4% lower than a year ago. The Nasdaq’s gain in the past year is more than 40%.
How the CEO at Ginkgo Bioworks Is Trading
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One year ago, Kelly owned more than 108.2 million shares, worth over $337.6 million. On last look, he owed more than 88.1 million shares, a stake of more than 4%. The stake was reduced by about 20 million shares, and its value decreased around 67.8% to near $108.6 million as the share price dropped.
| Shares a Year Ago | Shares Today | % Change |
| 108,213,460 | 88,152,333 | −18.54% |
As mentioned, CEO Jason Kelly might have sold shares for many reasons. Is it fair to interpret this reduction as a lack of confidence about a turnaround? The stock is down over 87% since a short seller report in late 2021. Earnings results fell short of expectations in the past few quarters. Only two of eight analysts recommend buying shares. However, they have a consensus price target of $3.08, which indicates they see the stock doubling in the next 12 months.
Additional insiders to watch include the other co-founders: Austin Che (head of strategy), Reshma Shetty (president and chief operating officer), and Barry Canton (chief technology officer). Each has a stake a little larger than Kelly’s.
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