Should Illumina Stock Holders Look At Thermo Fisher Instead

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Illumina (ILMN) and Thermo Fisher Scientific (TMO) both sell to drug developers and the labs that test patients, but they earn money from them differently. Illumina sells genetic sequencing machines and, above all, the supplies those machines keep using. Thermo Fisher sells a far wider range of lab instruments and drug development services. Illumina stock has returned 172.2% over the past year, against 21.7% for Thermo Fisher. So what is behind each company's latest sales forecast?

What Is Behind Each Company's Higher Sales Forecast?

On July 30, Illumina raised its 2026 revenue forecast to a midpoint of $4.62 billion, up from $4.57 billion in its April 30 release. Management said the raise reflects the second-quarter beat and higher hopes for the second half, with clinical markets its main growth driver. Management now expects its clinical markets to grow in the mid-teens in 2026, while sales of supplies to research and applied labs keep falling at a mid to high single-digit pace.

Thermo Fisher issued its newer forecast after reporting its latest quarter. The company posted 9% revenue growth in the third quarter to reach $12.14 billion, and management raised its 2026 revenue guidance on October 21 to a range of $47.7 billion to $48.2 billion. Thermo Fisher delivered very strong growth in its Pharma Services business and high single-digit growth with pharma and biotech customers, while academic and government revenue remained flat. So Illumina's higher forecast dates from July and leans on clinical labs, while Thermo Fisher's follows a quarter led by drug developers.

What Do Illumina And Thermo Fisher Keep And Owe?

Illumina keeps far more of each sales dollar after production costs. The company recorded a gross margin of 66.4% over the twelve months to June 28, 2026, against 40.8% for Thermo Fisher over its twelve months to June 27, 2026. Supplies generate most of Illumina's sales. Sequencing consumables brought in $775 million of its $1.16 billion revenue in fiscal Q2 2026. Illumina also placed over 95 NovaSeq X instruments in that quarter, and each placement adds to the installed base that uses those supplies.

Thermo Fisher's breadth comes with much more debt. At June 27, 2026, Thermo Fisher owed $42.5 billion in total debt, compared with $4.06 billion of cash and short-term investments. Illumina owed $2.53 billion at June 28, 2026, against $1.17 billion of cash and short-term investments.

Where Each Company Comes Out Ahead

Thermo Fisher comes out ahead on price and growth. At the October 22 close, Illumina stock traded at 49.3 times its trailing twelve months of earnings, compared with 36.0 for Thermo Fisher. Thermo Fisher's revenue grew 7.2% over the twelve months to late June 2026, against 4.9% for Illumina. Over the three twelve-month periods ending in June 2024, 2025 and 2026, Thermo Fisher's revenue growth averaged 2.2%, while Illumina averaged 0.3%.

Illumina comes out ahead on margin and debt. Over the twelve months to late June 2026, Illumina recorded an operating margin of 19.9%, compared with 18.3% for Thermo Fisher. Its net margin was 18.4%, against 15.0% for Thermo Fisher. Illumina's total debt equals 6.2% of its market value, while Thermo Fisher's debt equals 17.0%.

The financial measures split evenly. Thermo Fisher offers faster growth at a lower earnings multiple, and Illumina provides a wider margin and a lighter balance sheet. For an Illumina holder after the past year's run, the risk is paying the higher multiple for the slower grower. Illumina is expected to publish its fiscal Q3 2026 report in October 2026, and its revenue growth will be the number to watch, since growth is where Illumina trails.

Does This Mean You Should Act On ILMN?

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