TWST · Twist Bioscience
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $150.90
Note written ·
Price against the kill line
26.0% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $150.90, on record since 11 November 2026. The shares are down 10.3% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $150.90, just over the 50-day average of closes, would show the shares leading the S&P 500 and prove this call wrong; so would revenue for the quarter ending 31 December 2026 above the $132 million top of the guide with a raised fiscal 2027 outlook.
Research onlyNot in the portfolio.
Key figures from the filings · Health Care
Quarter to 30 June 2026, filed 3 August 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 118
- Revenue, change on a year (%)
- +23.2
- Gross margin (%)
- 52.8
- Operating margin (%)
- −30.6
- Free cash flow, four quarters ($M)
- −93.1
- Net cash, cash less debt ($M)
- 152
- Enterprise value to sales (×)
- 15.9
- Free-cash-flow yield (%)
- −1.3
All filed numbers
What Twist Bioscience reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 118 | +23.2 | 52.8 | −30.6 |
| first filed | 111 | +19.3 | 51.6 | −41.4 |
| first filed | 104 | +16.9 | 52.0 | −31.7 |
| first filed | 99.0 | +16.9 | 51.3 | −30.2 |
| first filed | 96.1 | +17.9 | 53.4 | −31.4 |
| first filed | 92.8 | +23.2 | 49.6 | −44.8 |
| Pre-tax income ($M) | −34.7 |
| Net income ($M) four quarters: −137 | −35.1 |
| Diluted shares, change on a year (%) against the quarter to 30 June 2025 | +2.0 |
| Operating cash flow ($M) | −53.1 |
| Capital spending ($M) | 40.1 |
| Free cash flow ($M) | −93.1 |
| Cash and short-term investments ($M) | 167 |
| Debt ($M) other long-term debt | 15.0 |
| Net cash, cash less debt ($M) | 152 |
| Deferred revenue ($M) +2.2% on a year | 12.1 |
| Backlog, orders not yet delivered ($M) +63.4% on a year | 21.9 |
| Receivables ($M) | 65.1 |
| Inventory ($M) | 35.2 |
| Shareholders' equity ($M) | 446 |
| Market value ($M) | 6,998 |
| Enterprise value, market value plus net debt ($M) | 6,846 |
| Enterprise value to sales (×) | 15.9 |
| Enterprise value to operating income (×) | Not meaningful |
| Price to earnings (×) | Not meaningful |
| Price to book value (×) | 15.7 |
| Free-cash-flow yield (%) | −1.3 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 16.3% of shares outstanding sold short, 2.8 days of average trading to cover, −3.4% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $99.9M |
| 12 monthsfrom | $0 | $148.1M |
The thesis
Twist Bioscience shares are more likely to lag the S&P 500 over the next three months. The company beat its fiscal fourth-quarter targets on 12 November 2026, but its fiscal 2027 outlook assumes much slower growth in artificial intelligence (AI) drug-discovery revenue, the part of the business that drove the shares' rise. The fiscal first-quarter report, expected in early February 2027, shows whether that outlook was set low on purpose or reflects real slowing.
The quarter itself was strong. Revenue for the three months to 30 September 2026 was $126.6 million, up about 28% from $99.0 million a year earlier and above the $123–124 million guide, per the company's 12 November 2026 Form 8-K. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, excluding specified items) was a profit of $2.2 million. Net loss was $20.6 million, or $0.32 per share.
The outlook is what moved the shares. Twist guided fiscal 2027 revenue to $550–560 million and fiscal first-quarter revenue to $130–132 million, per the 8-K. Investing.com reported that AI drug-discovery revenue was $59.1 million in fiscal 2026, up 175% from $21.5 million, while the fiscal 2027 guide assumes $100 million. Jefferies cut its target to $125 from $150 on 12 November 2026 and kept a Hold rating, saying the AI commentary disappointed against a high bar.
What the price reflects: Investing.com reported the shares at $98.87 after the results presentation on 12 November 2026, and they closed that day at $114.22, against $122.59 on 11 November 2026. The market had priced in faster AI growth than management guides to, and the close sits below Jefferies' $125 target. The rating is low because the business delivered while the outlook reset the AI growth rate the shares were valued on, and officers sold shares through October and early November.
Bullish and bearish views on Twist Bioscience Corporation
The bull case on Twist Bioscience Corporation (TWST), in brief: the fiscal fourth quarter beat both targets. The bear case: AI growth is guided to slow sharply.
Bull case
- The fiscal fourth quarter beat both targets. Revenue of $126.6 million beat the $123–124 million guide and adjusted EBITDA of $2.2 million beat breakeven, per the 12 November 2026 Form 8-K. A year earlier, the same quarter's adjusted EBITDA was a loss of $7.8 million.
- Both segments grew strongly. DNA Synthesis and Protein Solutions revenue rose 33% to $61.0 million and NGS (next-generation sequencing) Applications revenue rose 24% to $65.7 million in the quarter, per the 12 November 2026 release. Gross margin was 53.1%.
- AI orders run ahead of revenue. Investing.com reported on 12 November 2026 that management expects triple-digit growth in AI orders in fiscal 2027 and sees upside to the $100 million revenue figure. Jefferies estimates the gap between orders and revenue at roughly $20 million, per the same outlet.
- Adjusted profit is guided for the full year. The 12 November 2026 release guides fiscal 2027 to positive adjusted EBITDA and a 52.5%–53% gross margin, after a fiscal 2026 adjusted EBITDA loss of $35.9 million.
- The balance sheet funds capacity. Twist held about $582 million in cash, cash equivalents and short-term investments on 30 September 2026, per the 12 November 2026 release. Investing.com reported on 12 November 2026 that the company plans $150 million of capacity additions over two years to support revenue above $1 billion.
Bear case
- AI growth is guided to slow sharply. The $100 million fiscal 2027 AI assumption implies growth well under the 175% of fiscal 2026, per Investing.com on 12 November 2026. Jefferies described it the same day as less than 100% growth.
- Total growth does not accelerate. The $550–560 million fiscal 2027 guide compares with $459.4 million of fiscal 2026 revenue, which grew 22%, per the 12 November 2026 release. GuruFocus reported the shares fell before the open on 12 November 2026 because the guide fell short of higher expectations.
- Officers kept selling. SEC Form 4 filings show the chief executive, the president and chief operating officer, the chief accounting officer and two other officers sold shares at $135.40 on 3 November 2026, the chief executive 4,573 of them. The president sold 2,245 shares at $134.59 on 23 October 2026, and the chief financial officer sold 2,462 at $156.30 on 9 October 2026.
- A short report disputes the AI framing. The Bear Cave report of 5 November 2026, as summarised by Investing.com, calls Twist a life-sciences tools vendor in a crowded market where rivals offer comparable DNA and protein-testing services. Investing.com reported the shares fell 10% that day.
- Losses continue under standard accounting. Net loss was $20.6 million in the fiscal fourth quarter, per the 12 November 2026 release, despite positive adjusted EBITDA.
Price setup
The shares closed at $114.22 on 12 November 2026, down 3.7% over three months on adjusted daily closes and 48.0% below the 52-week intraday high of $219.71 set on 6 October 2026. The 52-week closing low is $25.45, from 19 November 2025, so the shares remain far above where the AI rally began.
The 12 November 2026 close sits well below the 50-day moving average of $150.57 and above the 200-day moving average of $92.89, both as of that close. Recent closes swing widely: $120.61 on 5 November 2026 after the short report, $135.34 on 9 November 2026, $132.13 on 10 November 2026, $122.59 on 11 November 2026 and $114.22 on 12 November 2026.
Below the last close, the levels the case turns on are the $98.87 low Investing.com reported on 12 November 2026 and the 200-day average. Above it, the 50-day average is still falling from the October peak; a recovery through it would mean the market has looked past the fiscal 2027 guide.
Catalysts ahead
- ~20 November 2026 (est.): Fiscal 2026 annual report on Form 10-K. Gives full-year segment detail, customer concentration and risk disclosures that show how much of AI drug-discovery revenue rests on a few accounts.
- ~11 January 2027 (est.): J.P. Morgan Healthcare Conference presentation (Twist presented at the 2026 event on 12 January 2026). A first public update on AI order trends and capacity since the fiscal 2027 guide; any change to the $100 million AI assumption would show up here first.
- ~2 February 2027 (est.): Fiscal first-quarter 2027 results (quarter ending 31 December 2026). Tests revenue against the $130–132 million guide and shows whether AI drug-discovery revenue is running ahead of the $100 million fiscal 2027 assumption, which decides whether the outlook was conservative.
What would change the view
A daily close above $150.90, just over the 50-day average of closes, would show the shares leading the S&P 500 and prove this call wrong; so would revenue for the quarter ending 31 December 2026 above the $132 million top of the guide with a raised fiscal 2027 outlook.
What it trades with
Twist trades with AI-enabled drug-discovery names more than with life-sciences tools companies. Since early October the shares have moved on AI sentiment, insider and fund selling and the 5 November 2026 short report as much as on company results. ARK Invest publishes its daily fund trades, which makes its selling a visible source of supply. The 12 November 2026 fall shows that the AI growth rate, more than total revenue, sets the price.
The evidence, claim by claim (8)
- Fiscal fourth-quarter 2026 revenue was $126.6 million, up about 28% from $99.0 million; DNA Synthesis and Protein Solutions $61.0 million, up 33%; NGS Applications $65.7 million, up 24%; gross margin 53.1%. Twist fiscal 2026 fourth-quarter results, Form 8-K Exhibit 99.1 · as of
- Fiscal fourth-quarter 2026 adjusted EBITDA was $2.2 million against a $7.8 million loss a year earlier; net loss was $20.6 million, or $0.32 per share; fiscal 2026 adjusted EBITDA was a $35.9 million loss. Twist fiscal 2026 fourth-quarter results, Form 8-K Exhibit 99.1 · as of
- Fiscal 2026 revenue was $459.4 million, up 22%; cash, cash equivalents and short-term investments were about $582 million at 30 September 2026. Twist fiscal 2026 fourth-quarter results, Form 8-K Exhibit 99.1 · as of
- Twist guided fiscal 2027 revenue to $550–560 million, gross margin to 52.5%–53%, adjusted EBITDA to positive and capital spending to about $75 million; fiscal first-quarter 2027 revenue to $130–132 million. Twist fiscal 2026 fourth-quarter results, Form 8-K Exhibit 99.1 · as of
- AI drug-discovery revenue was $59.1 million in fiscal 2026, up 175% from $21.5 million; the fiscal 2027 guide assumes $100 million. Investing.com, fiscal 2026 fourth-quarter slides article · as of
- Jefferies cut its Twist price target to $125 from $150 and kept a Hold rating, citing AI drug-discovery commentary that disappointed against a high bar. Investing.com, Jefferies note coverage · as of
- The chief executive, president and chief operating officer, chief accounting officer and two other officers sold shares at $135.40 on 3 November 2026; the chief executive sold 4,573 shares. SEC Form 4 filings dated 5 November 2026 · as of
- The Bear Cave published a critical valuation report on Twist; Investing.com reported the shares fell 10% that day. Investing.com · as of
Sources
- Twist Bioscience Corp - Form 8-K - FY2026 · sec.gov ·
- Twist Bioscience FY2026 Q4 slides: EBITDA milestone, stock drops 19% · in.investing.com ·
- Jefferies cuts Twist Bioscience stock price target on AIDD outlook · investing.com ·
- Twist Bioscience slides 10% as Bear Cave report questions valuation · investing.com ·
- Twist Bioscience (TWST) Shares Fall Premarket Despite Q4 Revenue Beat · gurufocus.com
- Twist Bioscience to Present at J.P. Morgan 2026 Healthcare Conference · businesswire.com ·
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