Illumina (ILMN) Upgraded to Buy: Here's Why

Core Viewpoint - Illumina (ILMN) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][2]. Earnings Outlook - The Zacks Consensus Estimate for Illumina for the fiscal year ending December 2024 is projected at $0.98 per share, reflecting a 14% increase from the previous year's reported figure [5]. - Over the past three months, the Zacks Consensus Estimate for Illumina has risen by 7.7%, indicating a trend of increasing earnings estimates [5]. Impact of Earnings Estimates - Changes in a company's future earnings potential, as indicated by earnings estimate revisions, are strongly correlated with near-term stock price movements [3]. - Institutional investors utilize earnings estimates to determine the fair value of a company's shares, which can lead to significant stock price movements based on their buying or selling activities [3]. Zacks Rating System - The Zacks Rank stock-rating system categorizes stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [4]. - The upgrade of Illumina to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for price appreciation in the near term [7].