Follow High Growth, High Return Stocks like Illumina (NASDAQ:ILMN): Interviews with Professional Investors

January 23, 2018

Finding high growth stocks that stay high growth for years is often the most rewarding target for professional investors.  Since 2015, the Wall Street Transcript has been publishing interviews with top rated research analysts and highly experienced portfolio managers as they show the love for one of these stocks, Illumina, Inc. (NASDAQ:ILMN).

Nancy Prial, CFA, is the Co-Chief Executive Officer and Senior Portfolio Manager at Essex Investment Management Company. She is the portfolio manager for the micro, small and smid growth strategies. Earlier, she worked at Burridge Growth Partners as the Chief Investment Officer and Senior Vice President responsible for the smid and small-cap growth strategies.  In an exclusive interview in the Wall Street Transcript on July 15, 2015, Ms. Prial called it for Illumina.

“Ms. Prial: We have owned Illumina (NASDAQ:ILMN) for a long time. We originally bought Illumina in the early 2000s in our small-cap portfolio. It was roughly a $250 million market-cap stock when we originally bought it in that portfolio. We no longer own it in that portfolio. We added it into our small/midcap portfolio when it crossed over $500 million market cap, and that is where we still own it.

At the time that we purchased Illumina, the company was not the company it is today. But people did not understand the power of their technology and what was possible for this upstart little company — and they were a very little company in those days — to gain market share, and to grow against who was the primary competitor and leader at that time, Affymetrix (NASDAQ:AFFX). What we saw was the power of their product. We liked the fact that they were a very small company because the math for the growth was easier. We saw a path where this company can consistently grow 40% to 50% a year for really as far as we could project forward, and we did not believe that was discounted in the price of the stock. ”


In March of 2016, in an exclusive interview with the Wall Street TranscriptBryan Brokmeier, CFA, a Senior Equity Research Analyst in life science tools and diagnostics at Cantor Fitzgerald also singled out Illumina as a stock to buy. Prior to joining Cantor Fitzgerald, Mr. Brokmeier was a Senior Health Care Analyst at Maxim Group, where he covered the life science tools and diagnostics sector. In 2014, Mr. Brokmeier was ranked the number three stock picker in the life science tools and services category by Thomson Reuters StarMine.

“Illumina has recently introduced new oncology panels that will increasingly compete with Thermo Fisher and is an area with a lot of growth. A lot of the initiatives that Illumina has been taking on should drive growth within the oncology market, which for them has already been growing over the last couple of years around 30% each quarter. We can start to see acceleration as they get these panels on the market and form new partnerships with additional biopharma companies as well as the academic market.

Liquid biopsies are one particular area where Illumina has been investing and recently announced an acceleration of that investment through the formation of its subsidiary, GRAIL. GRAIL seeks to accelerate the development of a cancer screening test using circulating tumor DNA. While there are many companies investing in liquid biopsies, including Trovagene, in the near term, these other companies are focused on developing tests for the noninvasive monitoring of oncogene mutation status, disease progression and disease recurrence, and are many years away from developing screening tests.”

On November 3, 2017, in an exclusive interview with the Wall Street TranscriptDavid Westenberg, CFA, a Senior Vice President and Senior Equity Analyst at C.L. King & Associates, repeated the ILMN recommendation. Mr. Westenberg joined C.L.King in January 2016 with seven-plus years of investment industry experience, most recently at Canaccord Genuity, where he was an Equity Research Associate covering 20 companies in the animal health and diagnostics industries.

His take on Illumina?

“When you are looking at Illumina, it has 80% to 90% market share, but its market backdrop is outstanding, and genomics itself is a multi-decade megatrend. Sequencing right now is growing at 15%-plus, and it is almost impossible to rip out an Illumina instrument once it has been placed into a laboratory, particularly on the clinical side because the reality is that somebody has to revalidate an instrument. In this particular market, you rarely get companies like this at a very good price. And investors know that, which means it’s multiple I think is safer relative to its peers. Maybe two to three years down the line, the entire market pulls back and the stock is at the same price, but you just buy more. You’ll be happy you’ve followed the story during that pullback.”

To follow the professional investors, read their entire interviews in the Wall Street Transcript.