Illumina Gains But Lags Market: What You Should Know

In the latest trading session, Illumina (ILMN) closed at $220.57, marking a +0.25% move from the previous day. This move lagged the S&P 500's daily gain of 1.19%. Meanwhile, the Dow gained 1.34%, and the Nasdaq, a tech-heavy index, lost 0.18%.

Coming into today, shares of the genetic testing tools company had gained 15.56% in the past month. In that same time, the Medical sector gained 1.38%, while the S&P 500 lost 0.84%.

Investors will be hoping for strength from Illumina as it approaches its next earnings release, which is expected to be November 3, 2022. The company is expected to report EPS of $0.29, down 80% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.1 billion, down 0.41% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.76 per share and revenue of $4.7 billion, which would represent changes of -53.22% and +3.95%, respectively, from the prior year.

 

It is also important to note the recent changes to analyst estimates for Illumina. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

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.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.65% lower. Illumina is currently sporting a Zacks Rank of #5 (Strong Sell).

Digging into valuation, Illumina currently has a Forward P/E ratio of 79.75. This valuation marks a premium compared to its industry's average Forward P/E of 19.73.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 58, which puts it in the top 24% 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.

 


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