Is ILMN a high-quality business?

AlphaMadera's AlphaQuality grade scores Illumina, Inc. on six pillars — profitability, capital efficiency, balance-sheet strength, growth durability, cash generation, and shareholder yield. The composite letter grade reflects how ILMN compares to a Buffett-style quality bar.

What is Illumina, Inc.'s AlphaQuality grade?

AlphaQuality assigns a letter grade (A through F) to ILMN based on a six-pillar quantitative model. The live page shows the composite grade plus each pillar's individual score with the underlying metrics.

What makes ILMN a quality stock?

AlphaQuality looks at return on capital, free-cash-flow margins, debt-to-equity, revenue stability, dividend and buyback policy, and operating-margin trend. Stocks scoring well across all six pillars earn higher grades — the methodology favors compounders over cyclicals.

ILMN - Illumina, Inc.

Price: -- -- | CONSENSUS: Buy DETAILS | PRICE TARGET: $200.14 DETAILS

AlphaQuality

Quantitative six-pillar business-quality grade

Stable Earnings Power

AlphaQuality — archetype-weighted quantitative grade

F 30.0 / 100 pillar composite

Composite Grade

Composite of six pillars weighted for stable earnings power businesses. Purely quantitative — the six pillars score only reported financials, no analyst input.

⚠ 3 of the last 5 fiscal years showed negative net income — AlphaQuality will not grade above F for persistent unprofitability in a stable earnings power business.

Grade overrides the 30.0 pillar composite because hard gates always win. Use the pillar breakdown below to see where the underlying numbers sit.

Profitability

Weight: 20%

D- 30.0

5yr Avg ROIC -7.4% 0/100
Operating Margin Trend +11.74 pp/yr 100/100

Capital Efficiency

Weight: 15%

F 15.5

5yr Avg ROE -20.0% 0/100
5yr Share-Count CAGR 1.1% 44/100

Growth Quality

Weight: 15%

C 54.6

5yr Revenue CAGR 6.0% 65/100
5yr EPS CAGR 4.2% 49/100
Revenue-Growth Years (5) 2/5 40/100

Cash Generation

Weight: 15%

B 73.7

5yr FCF Margin 10.7% 72/100
5yr FCF/NI Conversion 0.77x 76/100

Balance Sheet

Weight: 20%

A 91.2

Net Debt / EBITDA 0.63x 89/100
Interest Coverage (EBIT/Int) 11.75x 88/100
Altman Z-Score 6.64 100/100

Stability

Weight: 15%

B- 64.8

EPS Volatility (σ/μ) 0.26 63/100
Negative-Revenue Years (5) 3/5 40/100
Piotroski F-Score 8 89/100

4 of 4 gurus held; 2 added; 2 trimmed.

Holders: 4
Avg Δ position: -6.9%
New buys: 0
Full exits: 0

Wood decreased -34%
Greenblatt increased +4%
Cooperman increased +4%

How this is calculated

AlphaQuality grades six pillars from 0-100 and weights each by archetype:

Profitability (20%) — 5yr Avg ROIC, Operating Margin Trend
Capital Efficiency (15%) — 5yr Avg ROE, 5yr Share-Count CAGR
Growth Quality (15%) — 5yr Revenue CAGR, 5yr EPS CAGR, Revenue-Growth Years (5)
Cash Generation (15%) — 5yr FCF Margin, 5yr FCF/NI Conversion
Balance Sheet (20%) — Net Debt / EBITDA, Interest Coverage (EBIT/Int), Altman Z-Score
Stability (15%) — EPS Volatility (σ/μ), Negative-Revenue Years (5), Piotroski F-Score

The six pillars read only reported financial-statement fields — no analyst targets or consensus ratings. The archetype that picks which pillar formulas apply is not fully price-free, though: it can route a company to the distressed/ungradable archetype based on price vs. its 52-week high, and beta affects one classification check. A minimum of 5 fiscal years of audited statements is required. Insurers and banks are graded on their own methodology — insurers on loss ratio, its trend and stability, and premiums-to-surplus; banks on the efficiency ratio, its trend and stability, and equity-to-assets — rather than on industrial margin/ROIC signals. Distressed, highly leveraged infrastructure, asset-manager, and other financial businesses are declared ungradable rather than forced into a numeric score.