We recently compiled a list of the 10 Best Immunotherapy Stocks to Buy Now. In this article, we are going to take a look at where Illumina, Inc. (NASDAQ:ILMN) stands against the other immunotherapy stocks.
The global immunotherapy drugs market is rapidly expanding, with projections to grow from $240 billion in 2023 to $1.3 trillion by 2033. The growth is driven by the global rise in chronic diseases such as different types of cancer, autoimmune diseases, and infections.
Cancer, particularly is becoming more prevalent among people globally. The American Cancer Society recently released its 2024 Global Cancer Statistics report, which highlights the increasing burden of cancer worldwide. In 2022 alone, approximately 20 million new cancer cases were diagnosed, and 9.7 million people died from the disease. By 2050, annual cancer cases are expected to reach 35 million, driving demand for innovative treatments like immunotherapy.
Immunotherapy offers a promising alternative to traditional therapies, and its applications are expanding as research advances. It can be applied to various types of cancer, either alone or alongside treatments like chemotherapy. Immunomodulating agents, a type of non-specific immunotherapy, help improve the body’s immune system’s capability of detecting and attacking cancer cells.
Read Also: 10 Best Biotech Stocks To Buy Under $20 and 10 Best Cancer Stocks To Buy Now.
Due to the growing demand for treatments, leading pharmaceutical companies are also investing heavily in research and development to expand the range of immunotherapy drugs available. These include immune checkpoint inhibitors, CAR-T cell therapies, and monoclonal antibodies. Combining different therapies and tailoring treatments to individual patients is helping to unlock new applications for immunotherapy, positioning it to revolutionize cancer care and other areas of medicine.
North America led the global immunotherapy drugs industry in 2023, capturing over 48.19% of total revenue, driven by medical advancements and regulatory approvals, particularly in the US. The FDA’s approval of immunotherapy for cancers with specific genetic traits, regardless of origin, highlights the region’s leadership in innovative treatments like tumor-agnostic therapies.
With over 2 million new cancer cases expected in the US in 2024, demand for effective treatments like immunotherapy will continue to grow. Organizations such as Canada’s National Research Council are also developing new immunotherapies, aiming to provide hope for patients with hard-to-treat cancers like B-cell leukemia and lymphoma.
Our Methodology
We selected stocks from ETFs with immunotherapy exposure and narrowed down the list to the top 10 companies with the highest number of hedge funds holding stakes in them. The hedge fund sentiment has been sourced from Insider Monkey’s database of 912 hedge funds as of Q2 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A research facility with medical professionals surrounded by diagnostic equipment.
Illumina, Inc. (NASDAQ:ILMN)
Number of Hedge Fund Holders: 56
Illumina, Inc. (NASDAQ:ILMN) is a leading genomics company that provides advanced tools for analyzing DNA and RNA. Illumina, Inc. (NASDAQ:ILMN) plays a key role in advancing immunotherapy research, particularly through its next-generation sequencing (NGS) technologies. These tools help scientists study the mechanisms by which tumors evade the immune system and identify therapeutic targets that could boost immune responses against cancer.
Wall Street analysts and investors are optimistic about Illumina, Inc.’s (NASDAQ:ILMN) future, especially after the Grail spin-off in 2024 and the acquisition of Fluent Biosciences to improve its single-cell analysis and multiomics capabilities.
In Q2, Illumina exceeded expectations, achieving Core Illumina revenue of $1.1 billion and operating margins of 22.2%, supported by steady progress on its strategic goals. The stock has received a consensus rating of “Moderate Buy.”
Here’s what Patient Capital Management said about Illumina, Inc. (NASDAQ:ILMN) in its Q2 2024 investor letter:
“Illumina, Inc. (NASDAQ:ILMN) is a good example. We entered the name late last year as the company began to trade at a 5-yr low. The company is a leader in the genomic sequencing space but made an ill-advised acquisition of Grail, a blood-based multi-cancer early detection product, in 2021 for $8B dollars. Grail was an annual ~$600m drag on profitability hitting the financials at the same time that competition began to pick up and the overall demand environment began to weaken. Despite increased competition in the genome sequencing space, Illumina continues to be a leader with ~80% market share today. With the successful separation of Grail Inc. (GRAL) in June, Illumina has now returned to a pure-play sequencing company. As the company returns to historical profitability post Grail spin-off and as the demand environment normalizes post COVID, we believe you can buy a market leader in a secularly growing industry for less than a market multiple.”
Overall ILMN ranks 5th on our list of the best immunotherapy stocks to buy. While we acknowledge the potential of ILMN as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ILMN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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