A short, fool’s guide to $AMRS and the future.
Hello and hi. Don’t worry, this will all be over quickly.
Amyris (AMRS) is a synthetic biology company, that in short, feeds sugar to genetically engineered yeast, which in turn produce expensive, rare, or otherwise unsustainable molecules.
Such as squalane, a popular ingredient in skin care and beauty. Traditionally, squalane is derived from the livers of sharks, with approximately 3000 required to make one ton. Now, Amyris supplies that same squalane to most of the world’s largest cosmetic companies, while killing… 0! Not only that, they can produce it with higher purity, and at lower costs. Whoooo, save the sharks!
Want to invest in CBG without investing in garbage weed stocks? Well hey! They also make CBG, but without the difficulty to scale, land use, and regulatory risks of hemp plants.
AMRS produces molecules used in anti-malarial treatments, sweeteners, fragrances, skincare and more.
The best part, though, is what they don’t yet do. They are constantly growing their ingredient pool, with near limitless potential, and are nearing completion on a new plant, set to begin production in Q2 this year.
John Doerr, possibly the world’s most successful venture capitalist, reportedly owns around 20% of the company and serves on Amyris’ board.
Amyris sells their ingredients to other companies, while simultaneously using vertical integration to sell directly to consumers through their own well received brands, including Biossance, Terasana, JVN Hair, Rose Inc. among others.
These direct to consumer brands brought in $32.2 million in Q4 2021, an 86% YOY increase from Q4 of 2020. Someone far smarter and more well researched than I (I believe it’s https://www.reddit.com/user/Green_And_Green/) has been tracking sales for this quarter, and they are well on track to delivering another record quarter for Q1 2022 (see here https://twitter.com/gojadas/status/1494159445085114369). 2022 consumer revenue is expected to grow another 150%.
If you don’t like numbers, what about anecdotes? Their fastest growing brand, JVN Hair, is helmed by Jonathan Van Ness. Everyone loves him right? Maybe? Maybe not, not sure, but he has a huge following and is beloved at least by the beauty community.
If you don’t like anecdotes, what about GIFs? Rose Inc. is a partnership between Amyris and Rosie Huntington-Whitely, and we all know she has great taste…
If you don’t like GIFs, what about technicals?
Yeesh. AMRS dropped off a cliff after their Q3 2021 earnings call, and was in a downtrend until about 6 weeks ago, where, defying greater market trends, it broke and started its journey up, with sharp swings between $4~ and $5~. It appears to have found it’s bottom, pushing higher lows and higher highs. Isn’t it nice to find a stock that’s not at ATH?
The Bad Bits
Amyris had massive growth from the end of 2020 to earlymid 2021, where it began consolidating. Unfortunately, the CEO overpromised and underdelivered on revenue for Q3, citing supply chain issues (a poor excuse, in my opinion). I can’t, and won’t defend him. In fact I don’t like him. This busted the wedge and left a massive, near 50% gap from $14~ to $8~.
But Q4 earnings this month were better, with revenue exceeding estimates. Revenue for the year was around 340m, with 97% growth over 2020.
They also spend loads of cash. This is expected, of course, they’re growing. They have absurd potential, but often this means lots of R&D, and lots of growing pains. The gap down was exacerbated by a convertible notes offering [?] on November 15th which caused the miserable trek to the bottom, reached presumable (hopefully) late January. This money was used to pay off legacy debt and secure cash for growth. Cash on hand Dec. 31, 2021 was $483 million.
AMRS is a leader in its field, has enormous growth potential, has presumably, recently bottomed out, and has secured a good bit of cash. It is a rapidly growing company, so cash burn is high.
And for much, much better DD than I, see reddit.com/r/amyris.
AMRS is the only company I hold shares of, average cost $5.75~. Monthlies and leaps on the dips.
Submitted March 16, 2022 at 02:45PM by VelvetWhalefish
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