Friday, September 15, 2006

Calls of Note Part 6

- Piper Jaffray believes Illumina (NASDAQ:ILMN) is maintaining the momentum built during the first half and will remain the leader in the fast growth genotyping market. This belief is based on firm's view that Illumina's BeadArray technology is superior to Affymetrix genotyping offering. Users have experienced higher call rates and reproducibility with Illumina's HumanHAP 550 array than Affymetrix' 500K genotyping array.

With the patent litigation suit versus Affymetrix pushed out until January 29, 2007, the firm believes investors can invest in Illumina through year-end based solely on the performance of its business. They have learned that deCODE has completed the installation of its genotyping center in Iceland and is ramping up production rapidly.

As a result, they are increasing their 3Q:06 revenue forecast to $48 million at the high-end of management's guidance. Firm now estimates Illumina will report pro forma EPS of $0.25, a penny better than guidance, and GAAP EPS of $0.17.

They now forecast Illumina will grow revenues 131% this year to $170 million.

Maintains Outperform and $50 tgt.

Notablecalls: Expect to see some interest in ILMN following the call. While there is little new information to be found in the note, ILMN's chart looks like it wants to move higher.

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