Illumina Stock Falls As Analyst Warns Of Competition
By Amy Reeves, Investor's Business Daily
Gene-analysis giant Illumina's (ILMN) shares were down 3% in afternoon trading Monday after an analyst downgraded the stock, but they had been down 7% early in the day.
Robert W. Baird analyst Jeffrey Elliott wrote that the stock's valuation, which hit an eight-month high on Friday, was driven by rumors that Roche (RHHBY) might make another bid for Illumina, which it attempted to take over for $8.7 billion earlier this year. But Elliott noted new competitive threats from Life Technologies (LIFE) and Oxford Nanopore, and noted possible complications in Illumina's relationship with its largest customer, BGI, as they're both bidding to buy Complete Genomics (GNOM). Even if Illumina wins, the merger "would raise integration risk and require sizable investment, in our view," Elliott wrote.
Illumina's stock has been through some wild ups and downs in the last 18 months, but has regained a highest-possible IBD Composite Rating of 99 since its last quarterly report on Oct. 23. That quarter, double-digit profit and sales growth resumed after four flat quarters in a row, and analysts expect EPS growth in the teens through next year.
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