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Illumina (ILMN) Gains But Lags Market: What You Should Know

Zacks Equity Research
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In the latest trading session, Illumina (ILMN) closed at $309.84, marking a +0.21% move from the previous day. This change lagged the S&P 500's 0.5% gain on the day. Meanwhile, the Dow gained 0.54%, and the Nasdaq, a tech-heavy index, added 0.76%.

Prior to today's trading, shares of the genetic testing tools company had gained 5.72% over the past month. This has outpaced the Medical sector's gain of 2.18% and the S&P 500's gain of 2.53% in that time.

Investors will be hoping for strength from ILMN as it approaches its next earnings release. On that day, ILMN is projected to report earnings of $1.34 per share, which would represent a year-over-year decline of 7.59%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $834.29 million, up 6.69% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $6.53 per share and revenue of $3.77 billion, which would represent changes of +14.16% and +13.03%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for ILMN. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. The Zacks Consensus EPS estimate has moved 0.31% higher within the past month. ILMN is currently sporting a Zacks Rank of #2 (Buy).

Digging into valuation, ILMN currently has a Forward P/E ratio of 47.35. This valuation marks a premium compared to its industry's average Forward P/E of 22.51.

Also, we should mention that ILMN has a PEG ratio of 2.2. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Medical - Biomedical and Genetics stocks are, on average, holding a PEG ratio of 1.73 based on yesterday's closing prices.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This group has a Zacks Industry Rank of 78, putting it in the top 31% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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