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Illumina (ILMN) Preliminary Q1 Revenues Rebound, '21 View Up

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Illumina, Inc. (ILMN - Free Report) recently announced preliminary revenues for first-quarter 2021. The company expects to release detailed financial results for the period on Apr 27.

As per the preliminary report, first-quarter 2021 revenues are estimated to be approximately $1,085 million, up 26% from the year-ago quarter’s $859 million. The Zacks Consensus Estimate of $928.2 million remains below the preliminary figure.

As per the company, the sales uptick in the first quarter resulted from a surge in orders amounting to around $1.4 billion and year-over-year projected sequencing revenue growth of approximately 28%. Sequencing consumables business is expected to have grown by approximately 25% compared to the year-ago figures. Further, the preliminary estimate of COVID-19 surveillance revenues for sequencing consumables is approximately $20 million for the quarter.

Sequencing instrument business is expected to have registered growth of approximately 120% year over year, thus reflecting strength across all instrument categories.

Illumina now expects full-year 2021 revenue growth in the band of 25-28%, banking on the strength in its performance over the past few months. This is significantly up from its earlier projection of 17-20% announced in February. The Zacks Consensus Estimate for the full-year revenues is currently pegged at $3.89 billion.

Following this after-market release yesterday, shares of the company are up 10.1% in today’s premarket trading.

A Brief Q1 Analysis

Illumina, during the first quarter, observed a robust improvement in its Sequencing consumables arm compared to the pandemic phase, thus demonstrating strength in its core business. The company is upbeat about its performance in the to-be-reported quarter as the majority of its customers are now operating at pre-COVID-19 levels. Strength in its order receipts is also buoying optimism.

The company also confirmed in its preliminary results that its mid-throughput category recorded another solid quarter for placements. Per Illumina, some of its customers built additional capacity for COVID-19 surveillance work and accelerated instrument purchases. This resulted in approximately $35 million of incremental instrument revenues in the quarter.

Management also confirmed witnessing broad-based acceleration across Illumina’s core clinical and research applications with the increased adoption of next-generation sequencing (“NGS”). Additionally, the company recorded increased demand for COVID-19 surveillance, worldwide, due to the critical role that Illumina’s NGS technology plays to combat the pandemic.

Meanwhile, the company’s preliminary projection of a robust improvement in revenues compared to the sequentially last-reported quarter lifts our confidence.

Price Performance

Shares of the company have gained 0.6% in the past three months versus the industry’s 8.1% fall and the S&P 500’s 7.7% rise.

Zacks Rank & Key Picks

Currently, Illumina carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader medical space are Hologic, Inc. (HOLX - Free Report) , Hill-Rom Holdings, Inc. and DENTSPLY SIRONA Inc. (XRAY - Free Report) .

Hologic’s long-term earnings growth rate is estimated at 15.4%. The company presently sports a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Hill-Rom’s long-term earnings growth rate is estimated at 7.3%. It currently carries a Zacks Rank #2.

DENTSPLY’s long-term earnings growth rate is estimated at 20%. The company presently carries a Zacks Rank #2.

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