Illumina (ILMN) AI Stock Analysis

• Market Cap: $14.51B
• Dividend Yield: N/A
• Average Volume (3M): 1.44M
• Price to Earnings (P/E): 11.7
• Beta (1Y): 1.28
• Revenue Growth: -3.32%
• EPS Growth: N/A
• Country: US
• Employees: 8,970
• Sector: Healthcare
• Sector Strength: 45
• Industry: Medical - Diagnostics & Research
• EPS (TTM): 1.19
• Shares Outstanding: 153,700,000
• 10 Day Avg. Volume: 1,679,446
• 30 Day Avg. Volume: 1,435,765
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.13
• Enterprise Value/Revenue: 3.81
• Enterprise Value/Gross Profit: 5.73
• Enterprise Value/Ebitda: 9.15
• 1Y Price Target: $114.29
• Price Target Upside: 24.65% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 18

• Rating: 62 Neutral
• Price Target: $100.00 ▲(9.06% Upside)

Illumina's overall stock score is driven by strong cash flow management and improved profitability margins, despite revenue challenges and a bearish technical outlook. The company's valuation suggests potential for price appreciation, supported by positive earnings call guidance, although risks in the research market and China remain.

Positive Factors

Clinical Market Strength

The strong demand in clinical markets, particularly in oncology and genomic profiling, indicates a growing reliance on Illumina's products, supporting long-term revenue stability and expansion.

NovaSeq X Platform Adoption

The successful adoption of the NovaSeq X platform enhances Illumina's market position and boosts high-throughput consumable sales, ensuring sustained demand and competitive advantage.

Companion Diagnostics Partnerships

New partnerships in companion diagnostics expand Illumina's reach in precision oncology, fostering innovation and strengthening its position in the genomics market.

Negative Factors

Year-Over-Year Revenue Decline

The decline in revenue indicates challenges in maintaining growth, which could impact long-term financial performance if not addressed through strategic initiatives.

Research Market Constraints

Funding uncertainties in the research market may lead to reduced demand for Illumina's products, affecting revenue and growth prospects in this segment.

Challenges in China

Export restrictions to China limit Illumina's ability to capitalize on growth opportunities in a key market, potentially impacting future revenue and market expansion.

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 shows a mixed financial performance with signs of recovery. The income statement highlights improved profitability margins, although revenue has faced challenges. The balance sheet is stable, with balanced leverage, though the equity position has weakened. Cash flows are strong, reflecting effective cash management and operational recovery. Continued focus on revenue growth and maintaining profitability will be key for future financial success.

Income Statement

The income statement shows a mixed performance. The TTM (Trailing-Twelve-Months) gross profit margin is strong at 66.55%, indicating efficient cost management relative to revenue. However, the net profit margin has fluctuated significantly, with recent TTM data showing a recovery to 29.37% from negative margins in prior years. Revenue has declined compared to previous periods, suggesting challenges in sustaining growth. The EBIT and EBITDA margins have improved in the TTM period, showing signs of operational recovery.

Balance Sheet

The balance sheet reflects moderate financial stability with a debt-to-equity ratio of 0.97 in the TTM period, indicating a balanced leverage position. The return on equity has improved significantly to 48.27% in the TTM, driven by a positive net income. However, the equity ratio has decreased over time, reaching 42.82% in the TTM, suggesting a decrease in equity relative to total assets.

Cash Flow

The cash flow statement shows a robust recovery in free cash flow, with a strong growth rate of 45.42% from the previous period. The operating cash flow to net income ratio is favorable at 0.92 in the TTM, indicating effective cash generation from operations. Additionally, free cash flow to net income ratio is high at 0.82, suggesting efficient cash management. Overall, cash flows are well-managed, supporting financial flexibility.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.28B	4.37B	4.50B	4.58B	4.53B	3.24B
Gross Profit	2.85B	2.86B	2.74B	2.97B	3.15B	2.20B
EBITDA	1.78B	-725.00M	-608.00M	-3.92B	1.20B	1.09B
Net Income	1.26B	-1.22B	-1.16B	-4.40B	762.00M	656.00M
Balance Sheet
Total Assets	6.09B	6.30B	10.11B	12.25B	15.22B	7.58B
Cash, Cash Equivalents and Short-Term Investments	1.16B	1.22B	1.05B	2.04B	1.34B	3.47B
Total Debt	2.52B	2.62B	2.26B	3.56B	2.54B	1.91B
Total Liabilities	3.48B	3.93B	4.37B	5.65B	4.48B	2.89B
Stockholders Equity	2.61B	2.37B	5.75B	6.60B	10.74B	4.69B
Cash Flow
Free Cash Flow	1.03B	709.00M	282.00M	-74.00M	337.00M	891.00M
Operating Cash Flow	1.15B	837.00M	478.00M	392.00M	545.00M	1.08B
Investing Cash Flow	-201.00M	-178.00M	-231.00M	-591.00M	-1.07B	-554.00M
Financing Cash Flow	-945.00M	-570.00M	-1.21B	1.00B	-51.00M	-766.00M

Illumina Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 91.69
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ILMN, the sentiment is Negative. The current price of 91.69 is below the 20-day moving average (MA) of 98.25, below the 50-day MA of 99.55, and below the 200-day MA of 99.60, indicating a bearish trend. The MACD of -0.96 indicates Positive momentum. The RSI at 37.02 is Neutral, neither overbought nor oversold. The STOCH value of 4.59 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ILMN.

Illumina Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
A	77 Outperform	34.98B	28.58	19.15%	0.79%	4.48%	-11.52%
IQV	77 Outperform	30.53B	26.01	21.41%	―	3.53%	-10.72%
TMO	72 Outperform	175.30B	26.58	13.03%	0.36%	2.05%	7.03%
QGEN	70 Outperform	9.51B	25.71	10.65%	2.86%	5.15%	412.41%
DHR	69 Neutral	132.35B	38.54	6.52%	0.67%	-3.24%	-16.60%
ILMN	62 Neutral	$14.51B	11.68	68.11%	―	-3.32%	―
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%