brokerwatch

“A little more than three months after pricing its IPO at the top of its expected range and soaring out of the gate, Zymergen is warning investors that revenue from its experimental products won’t be coming anytime soon.” (CNBC)

Investors of Zymergen were shocked to learn that the value of the stocks they acquired when the company went public (in April) were almost 70% down on August 3. This was the result of a press release from Zymergen, which reads in part:

“Zymergen recently became aware of issues with its commercial product pipeline that will impact the Company’s delivery timeline and revenue projections. Accordingly, the Company no longer expects product revenue in 2021, and expects product revenue to be immaterial in 2022.”

 

“During the quarter, several key target customers encountered technical issues in implementing Hyaline into their manufacturing processes typical of new product and process development learnings. The Company has made significant progress towards addressing these challenges and believes there are no intrinsic technical issues with Hyaline. However, this issue has resulted in a delay in the Company’s commercial ramp.”

Now, it is alleged that Zymergen’s Registration Statement, an essential document for companies going public, omitted the problems with Hyaline, which eventually caused the stock value to drop.

According to MarketWatch,

“Less than four months after going public and being valued at more than $3 billion by Wall Street, Zymergen Inc. unleashed some bad news Tuesday afternoon, and was on pace to lose more than two-thirds of its market cap.”

 

“Zymergen shares ZY, -13.81% plunged about 70% in after-hours trading Tuesday, after the “biofacturing” company revealed that its only current product is struggling in the market, a major target for future business isn’t panning out, and its chief executive is stepping down “by mutual decision.” After pricing its IPO at $31 a share on April 21, seeing shares move as high as $52 since, and closing Tuesday at $34.83, shares were trading for less than $10 in the extended session.”

 

“During the quarter, several key target customers encountered technical issues in implementing Hyaline into their manufacturing processes typical of new product and process development learnings. The Company has made significant progress towards addressing these challenges and believes there are no intrinsic technical issues with Hyaline. However, this issue has resulted in a delay in the Company’s commercial ramp.”

Have you suffered losses investing in Zymergen? The attorneys at Peiffer Wolf will fight to recover your losses.

While a rebound was on the news after the initial loss, Bloomberg alerted investors: “Despite the rebound, the stock is down more than 50% since going public at $31 a share.” Furthermore,

“Zymergen said it’s working to restore investor trust after customers were running into trouble getting its bioprocessed film meant for use in items like foldable smartphones implemented into their manufacturing processes. But skepticism has grown among Wall Street analysts. William Blair’s Matt Larew, who downgraded the stock to the equivalent of neutral, said its credibility was “destroyed.”

If you have invested in Zymergen, you may still recover your losses. Contact Peiffer Wolf today by filling out a Contact Form on our website or by calling 314-833-4825 to schedule a FREE Case Evaluation.

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