Dog Days of Summer Lie Ahead- Q3 Seasonality in Life Sciences is Weak

A vicious 16% sell-off in Illumina Inc. (ILMN $58.43) due to revised 2011 guidance and subsequent analysts’ reduced outlook. Concerns about sales growth are a new concern. Revenue for Q2 was $287M a 36.5 %increase over Q2 2010 and an EPS of $0.38 compared to 0.26 in the 2010 prior Q.As usual with MO stocks that everybody owns even a minor tweak in forecasts can trigger selling. After the dust settles this could be a chance to add to your position. The Company is a leader in gene sequencing and analysis tools. The stock is now down 8.2% YTD. ILMN was added to the Rayno Life Science Portfoli0 on 2/2/09 at a price of $29.

Life Science Tools and Diagnostics stocks followed the leader with most stocks in the sector down over 3%:

Alere (ALR $29.32) down 14%

Cepheid (CPHD $38.15) down 3.37%

Complete Genomics (GNOM $12.25) down 7.27%

Life Technologies(LIFE $48.29) down 3%

NeoGen (NEOG $39.76) down 6.9%

Pacific Biosciences(PACB $10.89) down 5.88%

Sequenom (SQNM $6.96) down 5%

Many of these stocks were at all time and YTD highs over the past month. Also some of these stocks are down on low volume so we need to wait until tomorrow to see which stocks can recover.

The Rayno Life Science portfolio is down 3.5% today and the only green is value play Albany Molecular (AMRI $4.81) up 0.84% and Gilead (GILD $43.03) up 2%.

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