Auriga Reiterates Buy Rating on Illumina Inc. (ILMN)

Auriga is out with a research report this morning, where it reiterates its Buy rating on Illumina Inc. ILMN; it has a $75.00 price target on the stock. The Auriga analysts cited the company's recent pre-announcement of earnings, which topped estimates. Initial 2011 guidance appears slightly below current Street estimates, but is likely conservative. They analysts noted that, overall, ILMN appears well positioned to continue its dominance of the high-throughput sequencing market, particularly as the company continues to push HiSeq's accuracy and throughput higher, and reagent costs lower. In particular, ILMN has demonstrated runs of over 1 terabase internally – up from 1 gigabase four years ago. As for valuation, the analysts remarked, “Based on Illumina's exceptional growth of 50% in revenues in the last three years, attractive mid-20% operating margin and market leadership in the next generation sequencing market, a 35x multiple on our 2012E EPS of $2.15 with a $75 price target is reasonable, in our view.”