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Illumina (ILMN) Gains As Market Dips: What You Should Know


Illumina (ILMN) closed at $307.45 in the latest trading session, marking a +0.88% move from the prior day. This move outpaced the S&P 500′s daily loss of 2.06%. At the same time, the Dow lost 2.13%, and the tech-heavy Nasdaq lost 1.25%.

Coming into today, shares of the genetic testing tools company had lost 12.88% in the past month. In that same time, the Medical sector lost 3.4%, while the S&P 500 lost 3.01%.

ILMN will be looking to display strength as it nears its next earnings release, which is expected to be October 23, 2018. In that report, analysts expect ILMN to post earnings of $1.25 per share. This would mark year-over-year growth of 12.61%. Our most recent consensus estimate is calling for quarterly revenue of $825.07 million, up 15.56% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.46 per share and revenue of $3.31 billion, which would represent changes of +36.5% and +20.37%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ILMN. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.1% higher. ILMN is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that ILMN has a Forward P/E ratio of 55.8 right now. Its industry sports an average Forward P/E of 33.8, so we one might conclude that ILMN is trading at a premium comparatively.

It is also worth noting that ILMN currently has a PEG ratio of 2.52. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Medical – Biomedical and Genetics was holding an average PEG ratio of 1.95 at yesterday’s closing price.

The Medical – Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 81, putting it in the top 32% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow ILMN in the coming trading sessions, be sure to utilize Zacks.com.

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