Illumina, Inc. (ILMN) Stock Valuation — PE Analysis
Medical - Diagnostics & Research · NASDAQ
Current Price
$194.82
PE Ratio (TTM)
35.2x
Intrinsic Value
$189.21
-3.0% margin of safety
COMPETITIVE MOAT
↑Dominant Sequencing Market Share
Illumina holds over 90% of the genomics sequencing market. This entrenched position creates significant barriers to entry for competitors.
↑Razor-and-Blades Business Model
The company benefits from a recurring revenue stream through its high-margin consumables (reagents) sold alongside its sequencing instruments. This locks in customers.
↑NovaSeq X Momentum
The successful launch and adoption of the NovaSeq X platform are driving strong demand and reinforcing Illumina's technological leadership in high-throughput sequencing.
INVESTMENT RISKS
↓Dependence on Key Instrument Sales
While consumables provide recurring revenue, a slowdown in instrument sales could impact overall growth and profitability, especially if new instrument adoption falters.
↓Intense Competition in Genomics
Despite its market share, the genomics space is highly competitive, with ongoing innovation from other players that could challenge Illumina's pricing power or market position.
↓Execution Risk on Growth Initiatives
Achieving higher growth and profitability relies on successful execution of strategic initiatives and continued strong demand for its products and services.
Base case
ILMN base case PE valuation
A base case PE valuation for ILMN estimates a fair value of about $189.21 per share, against a current price of $194.82. The model assumes 6.2% annual earnings growth, a 35x target PE multiple, and a 10% discount rate.
Intrinsic Value
$189.21
Margin of safety
-3.0%
Expected annual return
-0.6%
Base case assumptions: 6.2% annual earnings growth, 35x target PE, 10% discount rate, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the ILMN PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Illumina, Inc. respond.
Open PE Calculator for ILMNCompany Overview
Illumina, Inc. specializes in delivering advanced genetic and genomic analysis tools, primarily through sequencing and array technologies. The company's offerings empower clients across various sectors to integrate genomic insights into both research and clinical environments, with applications spanning critical fields like life sciences, cancer diagnostics, reproductive health, agriculture, and innovative new domains. Illumina's portfolio encompasses specialized instrumentation and necessary consumables for genetic analysis, alongside comprehensive genotyping and sequencing services. They also offer instrument maintenance agreements, collaborate through development and licensing deals, and perform cancer detection tests. Its diverse clientele comprises leading genomic research facilities, universities, state-funded laboratories, medical centers, pharmaceutical and biotechnology firms, commercial molecular diagnostic providers, and businesses focused on consumer genomics. Illumina employs a two-pronged distribution strategy, selling directly to clients across North America, Europe, Latin America, and the Asia-Pacific. Additionally, it partners with life-science distributors to reach markets in Europe, the Asia-Pacific, Latin America, the Middle East, and Africa. Established in 1998, the company maintains its corporate headquarters in San Diego, California.
Financial Metrics — ILMN PE Stock Valuation Data
PE Ratio (TTM)
35.2x
PEG Ratio
0.27
Earnings Yield
2.86%
ROE (TTM)
34.0%
Revenue/Share (TTM)
$28.70
Debt/Equity
0.95x
Frequently Asked Questions
What is the PE ratio of ILMN?
The trailing twelve-month PE ratio of ILMN reflects how much investors pay per dollar of Illumina, Inc.'s earnings. This metric is most useful when compared to Medical - Diagnostics & Research peers and the company's own historical range.
Is ILMN overvalued based on PE ratio?
ILMN's PE of 35.2x combined with a PEG ratio of 0.27 provides a growth-adjusted perspective. A PEG below 1.0 means the P/E is low relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Medical - Diagnostics & Research, a DCF analysis may be more appropriate.
How do I value ILMN stock using PE ratio?
To value Illumina, Inc. using PE: (1) Compare the current PE (35.2x) against the Medical - Diagnostics & Research median to assess relative pricing, (2) check the PEG ratio (0.27) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of ILMN?
ILMN's PEG ratio is 0.27, calculated by dividing the PE ratio (35.2x) by the expected earnings growth rate. A PEG below 1.0 means the P/E is low relative to the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for ILMN stock valuation?
PE ratio gives a quick relative read — how ILMN is priced versus Medical - Diagnostics & Research peers. DCF provides an absolute value based on projected free cash flows. For ILMN, with a strong ROE of 34.0%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See ILMN DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Healthcare valuationsP/E and DCF value ILMN with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.