Illumina, Inc. (ILMN Quick QuoteILMN - Free Report) recently announced the launch of the latest version of DRAGEN software, DRAGEN 4.2, for analysis of next-generation sequencing (NGS) data. DRAGEN 4.2 is expected to expand accuracy combined with its flexibility and scalability to enable efficient workflows and extract meaningful insights from genomic data.

The latest launch is expected to significantly solidify Illumina’s foothold in the global genomics analysis space and boost its sequencing business.

Significance of the Launch

Per an expert familiar with the use of DRAGEN software, the latest offering of DRAGEN 4.2 is likely to be a significant step for genomics analysis as it combines the detection of multiple variant types in addition to a single nucleotide variant or SNV. This will likely foster a comprehensive analysis of genomic samples. The expert also feels that DRAGEN 4.2’s new features, which include new approaches for cardiovascular diseases such as callers for Lipoprotein(a) or LP(a), will likely provide a deeper insight into the gene.

Per Illumina, LP(a) is currently emerging as a clinically significant potential risk factor for cardiovascular disease. Targeted calling of the genetic variant associated with high levels of LP(a) can further help clinical research and aid in the development of testing and therapies.

Per Illumina’s management, DRAGEN’s ability to perform high-quality, fast, accurate and comprehensive NGS analysis workflows is expected to be ideally suited to support the healthcare and research industry in secondary analysis.

Industry Prospects

Per a report by MarketsandMarkets, the global genomics market was estimated to be $46.2 billion in 2023 and is anticipated to reach $83.1 billion by 2028 at a CAGR of 12.4%. Factors like the growing demand for gene therapy, increasing cancer incidence and significant decrease in sequencing costs are likely to drive the market.

Given the market potential, the launch seems to have been timed well.

Notable Developments

Last month, Illumina announced the new PrimateAI-3D, an artificial intelligence algorithm that predicts disease-causing genetic mutations in patients.

In April, Illumina announced its first-quarter 2023 results, wherein it registered an improvement in its top line on a sequential basis. Per management, NovaSeq X outperformed expectations in both customer demand and manufacturing supply during the reported quarter.

Price Performance

Shares of the company have gained 4% in the past year against the industry’s 12% decline. The S&P 500 has witnessed 16.5% growth in the said time frame.

Image Source: Zacks Investment Research

Zacks Rank & Other Key Picks

Currently, Illumina carries a Zacks Rank #2 (Buy).

A few other top-ranked stocks in the broader medical space are Hologic, Inc. (HOLX Quick QuoteHOLX - Free Report) , HealthEquity, Inc. (HQY Quick QuoteHQY - Free Report) and Boston Scientific Corporation (BSX Quick QuoteBSX - Free Report) .

Hologic, carrying a Zacks Rank #2 at present, has an estimated growth rate of 5.1% for fiscal 2024. HOLX’s earnings surpassed estimates in all the trailing four quarters, with an average of 27.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Hologic has gained 12.8% compared with the industry’s 15.2% rise in the past year.

HealthEquity, flaunting a Zacks Rank #1 at present, has an estimated long-term growth rate of 22%. HQY’s earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 9.1%.

HealthEquity has gained 11.9% against the industry’s 13.2% decline over the past year.

Boston Scientific, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 11.5%. BSX’s earnings surpassed estimates in two of the trailing four quarters and missed in the other two, the average surprise being 1.9%.

Boston Scientific has gained 43.1% against the industry’s 21% decline over the past year.