Illumina Inc (NASDAQ:ILMN) Presents a Compelling Value Investment Case

Illumina Inc (NASDAQ:ILMN) has recently been identified by a systematic screening process made to find possible value chances in the market. This screening process looks for companies with good fundamental valuation numbers while also having acceptable results in profitability, financial health, and growth areas. The method fits with traditional value investing ideas, where investors look for stocks trading for less than their inherent value while making sure the basic business has good operational foundations.

Valuation Assessment

The valuation numbers present a strong argument for Illumina's possible low price. The company's ChartMill Valuation Rating of 7/10 shows appealing pricing compared to both industry rivals and wider market measures. A few important numbers back this view:

• Enterprise Value to EBITDA ratio shows Illumina is less expensive than 94.64% of industry rivals
• Price to Free Cash Flow ratio is better than 91.07% of sector counterparts
• Forward P/E ratio of 18.60 looks good next to the industry average of 35.31
• PEG ratio indicates a fair valuation when considering predicted growth rates

These valuation traits are especially noteworthy for value investors, as they hint the market might be pricing Illumina's future earnings potential and cash flow creation abilities too low. The company's valuation seems separate from its solid market standing and technological benefits in the genomic sequencing field.

Financial Health and Stability

Illumina's financial health rating of 6/10 shows a varied but mostly steady condition. The company displays several strong points in solvency numbers while having some parts to watch:

• Altman-Z score of 3.43 shows low bankruptcy danger and is better than 71.43% of industry counterparts
• Debt to Free Cash Flow ratio of 1.93 indicates a good ability to handle debts
• Current ratio of 1.81 gives sufficient short-term liquidity
• Debt/Equity ratio of 0.66 shows a middling amount of debt within acceptable limits

For value investors, these health numbers give assurance that the company has the financial strength to handle market changes while still putting money into growth projects. The good solvency position lowers the risk of loss, an important factor when investing in possibly low-priced situations.

Profitability Metrics

The company's profitability rating of 7/10 highlights its operational effectiveness and solid market position. Illumina shows very good performance across several important profitability measures:

• Return on Assets of 20.67% is in the best 3.57% of the industry
• Return on Equity of 55.71% is higher than 96.43% of sector rivals
• Profit margin of 29.37% puts the company in the best 1.79% of the industry
• Gross margin of 66.55% shows good pricing control and cost management

These profitability numbers are vital for value investors as they show the company has lasting competitive benefits and effective operations. High returns on capital suggest that management is using resources well to create value for shareholders, which in theory should be seen in the stock price later on.

Growth Trajectory

While Illumina's growth rating of 5/10 seems average, a few future-looking signs point to possible speed-up. The company's growth picture mixes past difficulties with hopeful future outlooks:

• Earnings Per Share increased 352.17% in the last year, showing solid recent results
• Predicted EPS growth of 23.70% each year points to continued forward movement
• Revenue growth expectations of 3.57% each year show steady top-line increase
• EPS growth getting faster hints at better operational effectiveness

For value investors, this growth picture shows a notable chance where the market may not completely recognize the company's earnings recovery possibility. The mix of fair valuation and predicted growth speed-up makes a good risk-reward situation.

Complete Fundamental Analysis

The detailed fundamental analysis report gives more background for judging Illumina's investment potential. The total rating of 6/10 shows a balanced view where good profitability and appealing valuation make up for some questions about financial health and growth steadiness. This setup fits well with value investing ideas, where investors look for good businesses trading at sensible prices instead of flawless companies at high valuations.

The company's place in the life sciences tools and services industry gets structural growth support from more use of genomic technologies in research and clinical areas. Illumina's technological lead in DNA sequencing and BeadArray platforms creates lasting competitive benefits that back its good profitability numbers.

For investors wanting to find similar chances, more screening results are available using the Decent Value Stocks screening tool, which finds companies meeting similar valuation and fundamental requirements.

Disclaimer: This analysis is for information only and is not investment advice, a suggestion, or a support of any security. Investors should do their own research and talk to financial advisors before making investment choices. Past results do not promise future outcomes, and all investments have risk, including the possible loss of the original amount invested.