Canaccord Genuity Cuts Price Target on Illumina (ILMN) to $135 Following Weak 3Q Preannouncement
- S&P, Dow rise on health stocks; Nasdaq weighed by Comcast
- Unusual 11 Mid-Day Movers 10/27: (PCMI) (OCN) (TTMI) Higher; (CYH) (RWLK) (AMFW) Lower
- Twitter (TWTR) Tops Q3 EPS by 4c; Announces Restructuring, Workforce Reduction
- Qualcomm (QCOM) to Acquire NXP Semi (NXPI) in $47B Deal
- CenturyLink (CTL) in Advanced Talks to Merge with Level 3 (LVLT) - DJ
Get access to the best calls on Wall Street with StreetInsider.com's Ratings Insider Elite. Get your Free Trial here.
Canaccord Genuity maintained a Hold rating on Illumina (NASDAQ: ILMN), and cut the price target to $135.00 (from $165.00), following the company's 3Q preannouncement. After the close, ILMN preannounced revenues of ~$607M, ~$21M below the Street's $628M and the $625-630M guide. ILMN did not report adjusted EPS but the revenue shortfall implies EPS of $0.87, below the Street's $0.91 estimate.
Analyst Mark Massaro commented, "We expect ILMN to be off ~20%+ at the open after the company preannounced another large quarterly miss, and guided a very weak Q4. This evening we spoke to the company, who is still searching for answers to explain the miss, but does know the weakness was driven by a shortfall in the US from its 2500/4000 line, followed by one fewer HiSeq X system deal (an X5 or an X10), likely from China, in our view. While the preannounced Q3 shortfall is discouraging, the weak Q4 is troubling, especially since it is US-related and not China-related. What's more, we remain chiefly concerned about 2017 and 2018 growth as well as spending, "bridge years" before the company gets to Grail, if that launches in 2019 (we are not convinced of that, either). Trading at the loftiest valuation among its peers in the space, a reset in its multiple is sensible. We lower our PT to $135, which assumes a ~33x P/E multiple (from ~40x) on our 2017 Adj. EPS of $4.05. We will update our model after ILMN reports its full Q3 results on November 1st."
Shares of Illumina closed at $184.85 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Rosenblatt Upgrades NETGEAR (NTGR) to Buy
- Jefferies Raises Price Target on Coca Cola (KO) to $46 Following 3Q; Reaffirmed Guidance
- Needham & Company Raises Price Target on AXT, Inc. (AXTI) Following 3Q Beat and Guidance
Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst PT Change
Related EntitiesCanaccord Genuity
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!