Hi there,
ILMN is one of those genomics stocks - and to be honest, I am no expert in this area. What I can say however, is that the demand and market is rapidly growing.
FUrthermore, ILMN just released fiscal 2021 outlook in which it expects revenue to jump by 20% YOY and EPS to coming at $5.10-$5.35. Unfortunately, this was below analysts estimates and while 20% growth looks good on the surface, it is important to note that revenue dropped in 2020. In total, Fiscal 2021 is only expected to be 9.5% growth over Fiscal 2021.
The company did state that the genomics lifecycle is a long-term opportunity, so investors who are jumping into this company will have to be patient here. Genomics won't lead to accelerated growth in the near term. Right now, investors are paying 100 times earnings and 17 times forward sales for ILMN. I have a hard time justifying these prices for current level of growth which is expected to be high single digits to low teens over the next handful of years.
The company has clearly been bid up to the interest in genomics, and it could certainly continue its upward trend. We've seen insatiable appetite for EV stocks, meat alternative stocks and now genomics stocks. This can lead to a continued uptrend. It is however, worth being aware that the higher this stocks are bid up and the more expensive they become, the greater the risk.
Mat