As per a report by the Wall Street Journal, Carl Icahn, a billionaire activist investor, is preparing for a proxy battle at Illumina (ILMN:NSD), seeking three seats on the board of the biotechnology company.
Icahn has asserted that Illumina’s purchase of Grail, which is developing blood tests for the early detection of cancer, has been a risky venture and has cost shareholders almost $50 billion. The acquisition was announced by the company in 2020, but its legal complications have dragged down ILMN stock by over 40% in the past year, resulting in underperformance compared to the broader market averages.
Moreover, Icahn claimed that Illumina overpaid for Grail’s acquisition, as the company has little to no revenue, and the acquisition costs the company about $800 million per year. It is noteworthy that the European Commission has barred Illumina’s acquisition of Grail under the EU merger regulation.
Icahn attempted to avoid a proxy battle by proposing a deal with Illumina to secure three board seats, which the company rejected, stating that its board is diverse and experienced enough to represent the interests of its shareholders.
The success of Icahn’s attempt to nominate three directors to ILMN’s board remains uncertain. In the meantime, let’s take a look at what Wall Street is recommending for Illumina stock.
Due to concerns surrounding the Grail acquisition and short-term revenue pressure due to seasonality, analysts remain on the sidelines regarding Illumina stock.
Illumina Stock Forecast:
Based on the Illumina stock forecast from 22 analysts, the average analyst target price for Illumina Inc is USD 252.75 over the next 12 months. Illumina Inc’s average analyst rating is Buy.
Stock Target Advisor’s own stock analysis of Illumina Inc is Slightly Bearish, which is based on 4 positive signals and 6 negative signals. At the last closing, Illumina stock price was USD 194.01. Illumina stock price has changed by -12.30% over the past week, -1.31% over the past month, and -36.15% over the last year.