Illumina (ILMN) AI Stock Analysis

• Market Cap: $13.13B
• Dividend Yield: N/A
• Average Volume (3M): 2.35M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.25
• Revenue Growth: -3.47%
• EPS Growth: 25.55%
• Country: US
• Employees: 8,970
• Sector: Healthcare
• Sector Strength: 43
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 0.97
• Shares Outstanding: 158,300,000
• 10 Day Avg. Volume: 2,761,915
• 30 Day Avg. Volume: 2,346,856
• PEG Ratio: -0.45
• Price to Book (P/B): 4.69
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.21
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $108.53
• Price Target Upside: 28.88% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 20

Illumina's overall score of 53 reflects significant financial and operational challenges, including declining revenues and persistent losses. While the company demonstrates strengths in innovation and cost management, macroeconomic headwinds and geopolitical tensions, particularly in the Greater China region, remain significant risks. The stock's technical indicators suggest potential for recovery, though current valuation metrics are not favorable.

Positive Factors

Cost Management

A cost reduction program of $100M is expected to phase in this year, partly mitigating tariff impacts.

Financial Performance

Despite challenges, Illumina is delivering good execution and maintaining EPS growth.

Revenue Expectations

Illumina reported 1Q revenues of $1.04B slightly above the Street of $1.03B.

Negative Factors

China Market Challenges

Illumina faces significant headwinds from a recent import ban of its sequencers into China and continued uncertainty with respect to U.S. academic research funding.

Competitive Risks

Competition from Roche is considered a more meaningful risk for ILMN.

Guidance and Revenue Expectations

The company decreased its 2025 guidance for non-GAAP diluted EPS further, reflecting lower revenue expectations due to the challenges faced in China and tariff impacts.

Illumina Business Overview & Revenue Model

Company Description

Illumina, Inc. provides sequencing and array-based solutions for genetic and genomic analysis. Its products and services serve customers in a range of markets enabling the adoption of genomic solutions in research and clinical settings for applications in the life sciences, oncology, reproductive health, agriculture, and other emerging segments. The company provides instruments and consumables used in genetic analysis; and genotyping and sequencing services, instrument service contracts, and development and licensing agreements, as well as cancer detection testing services. Its customers include genomic research centers, academic institutions, government laboratories, and hospitals, as well as pharmaceutical, biotechnology, commercial molecular diagnostic laboratories, and consumer genomics companies. The company markets and distributes its products directly to customers in North America, Europe, Latin America, and the Asia-Pacific region, as well as sells through life-science distributors in various markets within Europe, the Asia-Pacific region, Latin America, the Middle East, and Africa. The company was incorporated in 1998 and is based in San Diego, California.

How the Company Makes Money

Illumina makes money through the sale of its sequencing systems and related consumables, which are essential for conducting genomic analysis. The company's primary revenue streams include the sale of sequencing instruments, consumables (such as reagents and flow cells), and services, including software and informatics solutions. A significant portion of Illumina’s revenue is derived from ongoing consumable sales, as these are required for each sequencing run. Additionally, Illumina generates income through service contracts, training, and support services. Strategic partnerships and collaborations with research institutions, healthcare providers, and pharmaceutical companies also contribute to its earnings by expanding its market reach and driving innovation in genomic applications. The company's focus on maintaining a robust portfolio of intellectual property and continuous investment in research and development further solidify its revenue model.

Illumina Financial Statement Overview

Summary

Illumina faces substantial financial challenges. Despite strong gross margins and manageable leverage, recurring losses and declining equity are significant concerns. Improving cash flow is a positive step, yet the company needs to focus on restoring profitability and growth to enhance its financial health.

Income Statement

The income statement reveals significant challenges. The TTM (Trailing-Twelve-Months) shows a negative net income and EBITDA, indicating profitability issues. Although the gross profit margin is strong at 65.43%, negative EBIT and EBITDA margins highlight operational inefficiencies. Revenue has been relatively stable, but the lack of growth and profitability is concerning.

Balance Sheet

The balance sheet presents a mixed picture. While the debt-to-equity ratio of 0.94 is manageable, the declining stockholders' equity over recent years is troubling. The equity ratio stands at 43.04%, showing moderate financial stability, but the consistent reduction in assets and equity poses a risk.

Cash Flow

Cash flow analysis indicates some positive signs. The operating cash flow to net income ratio is strong at -0.69, suggesting solid cash generation despite net losses. Free cash flow has improved significantly from the previous year, though the company must continue to enhance cash flow management to offset net income losses.

Breakdown
Dec 2024	Dec 2023	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
4.37B	4.50B	4.58B	4.53B	3.24B
	Gross Profit
2.86B	2.74B	2.97B	3.15B	2.20B
	EBIT
-833.00M	-1.07B	-4.18B	-123.00M	580.00M
	EBITDA
-725.00M	-608.00M	-3.92B	747.00M	767.00M
	Net Income Common Stockholders
-1.22B	-1.16B	-4.40B	762.00M	656.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.22B	1.05B	2.04B	1.34B	3.47B
	Total Assets
6.30B	10.11B	12.25B	15.22B	7.58B
	Total Debt
2.54B	2.26B	3.48B	2.47B	1.85B
	Net Debt
1.42B	1.21B	1.47B	1.24B	45.00M
	Total Liabilities
3.93B	4.37B	5.65B	4.48B	2.89B
	Stockholders Equity
2.37B	5.75B	6.60B	10.74B	4.69B
Cash Flow		Free Cash Flow
709.00M	282.00M	-74.00M	337.00M	891.00M
	Operating Cash Flow
837.00M	478.00M	392.00M	545.00M	1.08B
	Investing Cash Flow
-178.00M	-231.00M	-591.00M	-1.07B	-554.00M
	Financing Cash Flow
-570.00M	-1.21B	1.00B	-51.00M	-766.00M

Illumina Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 84.21
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ILMN, the sentiment is Neutral. The current price of 84.21 is above the 20-day moving average (MA) of 78.68, above the 50-day MA of 79.16, and below the 200-day MA of 117.70, indicating a neutral trend. The MACD of 1.03 indicates Negative momentum. The RSI at 59.05 is Neutral, neither overbought nor oversold. The STOCH value of 92.52 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ILMN.

Illumina Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
A	79 Outperform	$32.34B	26.07	20.61%	0.85%	-3.00%	3.67%
IQV	76 Outperform	$24.83B	19.75	21.65%	―	2.84%	-0.16%
IDXX	74 Outperform	$41.95B	47.79	59.33%	―	5.56%	4.66%
TMO	69 Neutral	$156.25B	24.29	13.73%	0.39%	0.96%	9.19%
DHR	64 Neutral	$140.56B	38.08	7.22%	0.57%	-9.19%	-12.75%
ILMN	53 Neutral	$13.13B	―	-23.82%	―	-3.47%	25.55%
Sector *	52 Neutral	$5.19B	3.04	-44.20%	2.82%	16.59%	-0.39%

Illumina Corporate Events

Illumina Updates 2025 EPS Guidance Amid Export Challenges

On March 10, 2025, Illumina announced an updated non-GAAP diluted EPS guidance for fiscal year 2025 and a cost reduction program. The company is addressing export restrictions imposed by China’s Ministry of Commerce, which could impact its revenue from the Greater China business. Despite these challenges, Illumina remains committed to expanding its multiomics portfolio and achieving high-single-digit revenue growth by 2027. The company expects a fiscal 2025 non-GAAP diluted EPS of approximately $4.50 and plans to implement a $100 million cost reduction program to mitigate potential revenue impacts from the Chinese market.