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Illumina (ILMN) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Illumina (ILMN - Free Report) closed at $344.76, marking a -0.17% move from the previous day. This move lagged the S&P 500's daily gain of 0.03%. Elsewhere, the Dow gained 0.06%, while the tech-heavy Nasdaq added 0.15%.

Coming into today, shares of the genetic testing tools company had gained 19.32% in the past month. In that same time, the Medical sector gained 4.54%, while the S&P 500 gained 2.98%.

Investors will be hoping for strength from ILMN as it approaches its next earnings release, which is expected to be October 23, 2018. The company is expected to report EPS of $1.25, up 12.61% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $825.83 million, up 15.66% from the prior-year quarter.

ILMN's full-year Zacks Consensus Estimates are calling for earnings of $5.46 per share and revenue of $3.31 billion. These results would represent year-over-year changes of +36.5% and +20.31%, respectively.

It is also important to note the recent changes to analyst estimates for ILMN. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 12.14% higher within the past month. ILMN currently has a Zacks Rank of #1 (Strong Buy).

Digging into valuation, ILMN currently has a Forward P/E ratio of 63.22. For comparison, its industry has an average Forward P/E of 29.26, which means ILMN is trading at a premium to the group.

Also, we should mention that ILMN has a PEG ratio of 2.86. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Medical - Biomedical and Genetics stocks are, on average, holding a PEG ratio of 1.88 based on yesterday's closing prices.

The Medical - Biomedical and Genetics industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 97, which puts it in the top 38% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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