Illumina, Inc. (ILMN), Gartner Inc (IT): Top 2 Positions of a Successful Opportunity Fund

Page 1 of 2

Mike Lippert, the portfolio manager of Baron Opportunity Retail Fund, has managed to generate outstanding returns in the past ten years. This fund gets a four star rating from Morningstar, delivering a sweet 10-year-annualized return of 12.40%, beating the S&P 500’s return of only 8.05% during the same period. Year-to-date, it gained by nearly 21%, a bit higher than S&P 500’s gain of 19.62%. The top two stocks in its portfolio were Illumina, Inc. (NASDAQ:ILMN) and Gartner Inc (NYSE:IT). Let’s take a closer look to see whether or not we should follow Mike Lippert into those two stocks.

Illumina, Inc. (NASDAQ:ILMN)

The biggest player in the sequencing market

Illumina, Inc. (NASDAQ:ILMN) is Baron’s largest position, accounting for nearly 4.1% of the total portfolio. Incorporated in 1998, it is the leader in manufacturing and developing of life science tools and integrated systems for genetic analysis. The company generated around $568.4 million, or 49.5% of its total revenue, within in the U.S., while Asia-Pacific ranks second with nearly $232.5 million in sales. The company reported that most of its revenue (64%) derived from consumable sales, while instrument sales accounted for 27% of total 2012 revenue.

In the past four years, Illumina, Inc. (NASDAQ:ILMN) has consistently grown its top line and generated positive cash flow. Revenue increased from $666 million in 2009 to nearly $1.15 billion in 2012, while free cash flow fluctuated in the range of $119 million to $279 million during the same period. For the full year, Illumina, Inc. (NASDAQ:ILMN) expects to grow its revenue by 20%, and its non-GAAP EPS might come in at around $1.68 – $1.72, including the acquisition impact of Verinata and Advanced Liquid Logic. Illumina, Inc. (NASDAQ:ILMN) is trading at $78.80 per share, with a total market cap of $9.86 billion. The market values Illumina, Inc. (NASDAQ:ILMN) at as much as 38.9 times its forward earnings.

Mike Lippert likes Illumina was the best company with the dominating position in the DNA-based tests business, with around 100% share of the sequencing instruments in the U.S. He likes the high amount of recurring revenue coming from consumables, which was sold in every test the customers do.

Much more expensive than Life Technologies Corp. (NASDAQ:LIFE)

Compared to one of its peers, Life Technologies Corp. (NASDAQ:LIFE), Illumina has a much higher valuation. Life Technologies Corp. (NASDAQ:LIFE) is trading at $74.80 per share, with a total market cap of $12.90 billion. The market values Life Technologies Corp. (NASDAQ:LIFE) much more cheaply, at only 16.4 times its forward earnings. Life Technologies is the global biotech company, offering around 50,000 end-to-end solutions to more than 75,000 customers in more than 180 countries.

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!