Illumina (ILMN) Grows on Innovation & Strategic Partnerships

A generic image of a stock chart Credit: Shutterstock photo

On May 30, we issued an updated research report on Illumina, Inc.ILMN , a Zacks Rank #3 (Hold) stock. The company's market opportunities continue to expand owing to accelerated demand from clinical and translational customers. Its recent strategic collaborations are also expected to widen its product portfolio.

Shares of the company have outperformed the industry over the last three months. The stock has rallied 21.3% against the industry 's 6.6% decline.

Notably, Illumina exited the first quarter of 2018 on a solid note with better-than-estimated earnings as well as revenues. Moreover, we are encouraged by the significant year-over-year growth on both counts. This huge upside can be attributed to a strong rise in consumables across Illumina's sequencing portfolio.

Illumina, Inc. Price

Illumina, Inc. Price | Illumina, Inc. Quote

Additionally, management is hopeful about the recently launched NovaSeq S1 flow cell reagent kit. The company also received a product approval certificate for the NextSeq 550Dx instrument from the Ministry of Food and Drug Safety in South Korea. In the field of oncology, Illumina's collaborations with Bristol-Myers Squibb and Loxo Oncology are likely to garner positive results down the line. Meanwhile, the company's raised 2018 guidance indicates that it will deliver an impressive performance in the quarters to come.

San Diego, CA-based Illumina is a tools and integrated systems provider for the analysis of genetic variation and function. The company focuses on product innovation via research and development, evident from its recent launch of iSeq 100 Sequencing System.

Post a promising first quarter, we expect Illumina to maintain its growth momentum on the continued uptake of sequencing consumables, instruments and microarray portfolios.

On the flip side, the company faces stiff competition in the sequencing, SNP (single nucleotide polymorphisms) genotyping, gene expression and molecular diagnostics markets with several bigwigs already enjoying a significant market share, intellectual property portfolios as well as regulatory expertise. Also, the National Institutes of Health funding issue raises a concern.

Key Picks

Some better-ranked stocks in the broader medical sector are Intuitive Surgical ISRG , ResMed Inc. RMD and Amedisys, Inc. AMED . While Intuitive Surgical sports a Zacks Rank #1 (Strong Buy), ResMed and Amedisys carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

Intuitive Surgical has an expected long-term earnings growth rate of 12.1%.

ResMed has long-term historical earnings growth of 9.3%.

Amedisys projects long-term earnings growth of 17.5%.

More Stock News: This Is Bigger than the iPhone!

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.

Click here for the 6 trades >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Intuitive Surgical, Inc. (ISRG): Free Stock Analysis Report

ResMed Inc. (RMD): Free Stock Analysis Report

Illumina, Inc. (ILMN): Free Stock Analysis Report

Amedisys, Inc. (AMED): Free Stock Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

More Related Articles

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.