Analyzing Abaxis (ABAX) and Illumina (ILMN)

Abaxis (NASDAQ: ABAX) and Illumina (NASDAQ:ILMN) are both medical companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, earnings, dividends, valuation and profitability.

Volatility and Risk

Abaxis has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500. Comparatively, Illumina has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings for Abaxis and Illumina, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Abaxis 1 4 1 0 2.00
Illumina 1 6 13 0 2.60

Abaxis presently has a consensus target price of $56.63, suggesting a potential downside of 12.33%. Illumina has a consensus target price of $242.18, suggesting a potential upside of 11.50%. Given Illumina’s stronger consensus rating and higher probable upside, analysts clearly believe Illumina is more favorable than Abaxis.

Dividends

Abaxis pays an annual dividend of $0.64 per share and has a dividend yield of 1.0%. Illumina does not pay a dividend. Abaxis pays out 59.3% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Abaxis and Illumina’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Abaxis $227.22 million 6.45 $32.71 million $1.08 59.81
Illumina $2.75 billion 11.52 $726.00 million $4.93 44.05

Illumina has higher revenue and earnings than Abaxis. Illumina is trading at a lower price-to-earnings ratio than Abaxis, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

97.7% of Abaxis shares are owned by institutional investors. Comparatively, 92.1% of Illumina shares are owned by institutional investors. 4.3% of Abaxis shares are owned by insiders. Comparatively, 0.9% of Illumina shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Abaxis and Illumina’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Abaxis 10.51% 10.09% 8.69%
Illumina 26.56% 21.52% 11.94%

Summary

Illumina beats Abaxis on 11 of the 16 factors compared between the two stocks.

Abaxis Company Profile

Abaxis, Inc. is a developer, manufacturer and marketer of portable blood analysis systems that are used in medical specialties in human or veterinary patient care to provide clinicians with blood constituent measurements. The Company markets and sells its products around the world through independent distributors and direct sales force. The Company’s segments are the medical market and the veterinary market. The Company’s medical market products include Piccolo chemistry analyzers and consumable products. The Company develops, manufactures and sells the Piccolo Xpress chemistry analyzer for use in human patient care to provide clinicians with blood constituent measurements. The Company’s veterinary market product offerings include VetScan chemistry analyzers and veterinary reagent discs, VetScan hematology instruments and related reagent kits, VetScan VSpro specialty analyzers and related consumables, VetScan i-STAT analyzers and related consumables and VetScan rapid tests.

Illumina Company Profile

Illumina, Inc. (Illumina) is a provider of sequencing- and array-based solutions for genetic analysis. The Company operates through two segments: Core Illumina and the consolidated variable interest entities (VIEs), which include the activities of GRAIL, Inc. (GRAIL) and Helix Holdings I, LLC (Helix). Core Illumina consists of its core operations. Core Illumina’s products and services serve customers in the research, clinical and applied markets, and enable the adoption of a range of genomic solutions. The Company’s portfolio of integrated systems, consumables and analysis tools addresses the range of genomic complexity, price points, and throughput, enabling customers to select the solution for their research or clinical challenge. The Company provides reproductive-health solutions, including noninvasive prenatal testing (NIPT), preimplantation genetic screening and diagnosis, and neonatal and genetic health testing.

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