In a research report released this morning, Canaccord Genuity analyst Mark Massaro initiated coverage on shares of Illumina, Inc (NASDAQ:ILMN) with a Buy rating and price target of $275, which implies an upside of 19% from current levels.
In explaining his positive Buy rating Massaro stated, “We think Illumina is the dominant market leader across several markets of sequencing and estimate the company’s TAM is likely ~$30B today (vs. its 2014 estimate of $20B) and growing to ~$50B by the end of the decade. We think Illumina’s suite of sequencing instruments could revolutionize both the genetic research market with its high throughput sequencer instruments and the clinical diagnostic market with its lower cost bench top targeted sequencing instruments. Meanwhile, we see the array business (~15% of revenue) as a stable and predictable product line that serves as an opportunity to upgrade customers to sequencing.”
Bottom line: “We believe ILMN is a must-own stock for large-cap growth and GARP mandates given the company’s dominant leadership position, innovation and pipeline in the dynamic next-generation sequencing (NGS) market opportunity we peg at close to $50 billion by the end of the decade. We think ILMN enters adjacent markets and expands its vision long term. Near term, we expect strong growth in high-throughput sequencing, oncology and prenatal diagnostics.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Mark Massaro has a total average return of -3.0% and a 53.5% success rate. Massaro is ranked #3257 out of 3712 analysts.