Illumina (ILMN) AI Stock Analysis

• Market Cap: $17.86B
• Dividend Yield: N/A
• Average Volume (3M): 1.90M
• Price to Earnings (P/E): 27.4
• Beta (1Y): 1.32
• Revenue Growth: -2.39%
• EPS Growth: N/A
• Country: US
• Employees: 8,970
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 1.34
• Shares Outstanding: 152,800,000
• 10 Day Avg. Volume: 2,271,050
• 30 Day Avg. Volume: 1,895,881
• PEG Ratio: -3.75
• Price to Book (P/B): 8.95
• Price to Sales (P/S): 4.86
• P/FCF Ratio: 29.95
• Enterprise Value/Market Cap: 0.86
• Enterprise Value/Revenue: 4.84
• Enterprise Value/Gross Profit: 7.31
• Enterprise Value/Ebitda: 15.62
• 1Y Price Target: $115.36
• Price Target Upside: -4.75% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 14
• EPS Forecast (FY): 4.68
• Revenue Forecast (FY): $4.28B

• Rating: 73 Outperform
• Price Target: $138.00 ▲(13.95% Upside)

Illumina's strong performance in the earnings call and bullish technical indicators are the most significant factors driving the score. Financial performance shows recovery but is tempered by increased leverage and cash flow challenges. Valuation is reasonable, supporting a positive outlook.

Positive Factors

Revenue Growth

Exceeding revenue guidance indicates strong market demand and effective execution of business strategies, supporting long-term growth.

Clinical Market Expansion

Growth in clinical markets reflects increasing adoption of genomics in healthcare, bolstering Illumina's position in personalized medicine.

NovaSeq X Transition

Successful NovaSeq X transition enhances Illumina's competitive edge in high-throughput sequencing, driving future revenue streams.

Negative Factors

Increased Leverage

High leverage can limit financial flexibility and increase risk, potentially impacting long-term financial health if not managed properly.

Cash Flow Challenges

Challenges in cash generation could constrain investment in growth initiatives and affect operational agility over time.

Ongoing Challenges in China

Continued issues in China due to export restrictions pose a risk to revenue growth and market expansion efforts in a key region.

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 generates revenue primarily through the sale of its sequencing systems, consumables, and associated software and services. The company's main revenue streams include the sale of instruments, which are often sold at lower margins, and the recurring revenue from consumables, such as reagents and flow cells, which have higher margins. Additionally, Illumina earns revenue from its services, including genomics data analysis and bioinformatics. The company also collaborates with pharmaceutical companies, research institutions, and other organizations, forming partnerships that enhance its technology offerings and expand its market reach. These collaborations often lead to joint research initiatives and further drive demand for Illumina's products. Furthermore, as the healthcare industry increasingly adopts genomics-based solutions, Illumina stands to benefit from the growing market for personalized medicine and genomic testing.

Illumina Financial Statement Overview

Summary

Illumina demonstrates a solid financial recovery with improved profitability and revenue growth in the TTM period. The income statement shows strong revenue growth and positive net profit margins. However, the balance sheet indicates increased leverage, and cash flow analysis reveals challenges in cash generation.

Income Statement

Illumina's income statement shows a strong recovery in the TTM period with a revenue growth rate of 12.6% and a positive net profit margin of 16.39%, compared to negative margins in previous years. The gross profit margin remains robust at 66.21%. However, the EBIT and EBITDA margins, while positive, are lower than historical highs, indicating room for improvement in operational efficiency.

Balance Sheet

The balance sheet reflects a stable equity position with a debt-to-equity ratio of 1.05 in the TTM period, slightly improved from the previous year. Return on equity has turned positive at 28.95%, showcasing effective utilization of equity. However, the equity ratio has decreased over time, suggesting increased leverage which could pose risks if not managed carefully.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth by 4.45% in the TTM period, indicating potential challenges in cash generation. The operating cash flow to net income ratio is 0.57, suggesting moderate cash conversion efficiency. The free cash flow to net income ratio is healthy at 0.89, reflecting good cash flow relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2019	Dec 2018	Dec 2017
Income Statement
Total Revenue	3.18B	4.37B	4.50B	3.54B	3.33B	2.75B
Gross Profit	2.11B	2.86B	2.74B	2.47B	2.30B	1.83B
EBITDA	987.00M	-725.00M	-608.00M	1.36B	1.06B	780.00M
Net Income	516.00M	-1.22B	-1.16B	1.00B	826.00M	726.00M
Balance Sheet
Total Assets	6.18B	6.30B	10.11B	7.32B	6.96B	5.26B
Cash, Cash Equivalents and Short-Term Investments	1.28B	1.22B	1.05B	3.41B	3.51B	2.15B
Total Debt	2.58B	2.62B	2.26B	1.84B	2.00B	1.34B
Total Liabilities	3.80B	3.93B	4.37B	2.70B	3.11B	2.41B
Stockholders Equity	2.38B	2.37B	5.75B	4.61B	3.85B	2.84B
Cash Flow
Free Cash Flow	665.00M	709.00M	282.00M	842.00M	846.00M	563.00M
Operating Cash Flow	758.00M	837.00M	478.00M	1.05B	1.14B	875.00M
Investing Cash Flow	-163.00M	-178.00M	-231.00M	745.00M	-1.81B	-214.00M
Financing Cash Flow	-681.00M	-570.00M	-1.21B	-897.00M	594.00M	-176.00M

Illumina Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 121.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• 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 Positive. The current price of 121.11 is above the 20-day moving average (MA) of 102.81, above the 50-day MA of 100.06, and above the 200-day MA of 94.16, indicating a bullish trend. The MACD of 5.78 indicates Negative momentum. The RSI at 67.12 is Neutral, neither overbought nor oversold. The STOCH value of 83.20 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ILMN.

Illumina Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
A	79 Outperform	$41.41B	34.26	19.88%	0.67%	4.48%	-11.52%
IQV	77 Outperform	$35.93B	28.85	19.55%	―	3.85%	-4.74%
DHR	75 Outperform	$151.04B	44.01	6.84%	0.58%	2.22%	-7.60%
ILMN	73 Outperform	$17.86B	27.43	31.20%	―	-2.39%	―
TMO	73 Outperform	$212.37B	32.66	13.14%	0.30%	3.22%	8.26%
QGEN	66 Neutral	$9.58B	25.85	10.81%	2.85%	5.15%	412.41%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%

Illumina Corporate Events

Illumina’s Earnings Call: Optimism Amid Challenges

Illumina’s recent earnings call painted a picture of optimism and resilience, despite some challenges in specific markets. The company reported exceeding revenue and earnings expectations, driven by significant progress in clinical markets and the successful transition to NovaSeq X. However, hurdles remain in research markets and China, yet Illumina remains positive about its strategic initiatives and future growth prospects.

Illumina Reports Steady Q3 2025 Earnings

Illumina, Inc. is a global leader in DNA sequencing and array-based technologies, serving research, clinical, and applied markets with innovative solutions in the life sciences sector.

Illumina’s Sequencing Study: A Game Changer in Hematologic Diagnostics?

Study Overview: The study titled Testing the Diagnostic Supremacy of Sequencing-only Approaches in Hematologic Malignancies: an Observational Trial aims to evaluate the effectiveness of sequencing-only methods, specifically Whole Genome Sequencing (WGS) and Whole Transcriptome Sequencing (WTS), in diagnosing hematologic malignancies. This research is significant as it seeks to improve diagnostic accuracy for cases that remain unresolved by traditional methods, potentially enhancing patient outcomes.