Following a significant reduction in our fair value estimate after the recent analyst day, prompted by weaker-than-expected targets from Illumina's management team, we no longer see sufficient upside in the shares to justify their inclusion on the Best Ideas list. Our revised fair value estimate reflects diminished sales growth prospects—projected at 7% annually over the next decade, down from the previously anticipated 9%—due to a slightly lower outlook for the entire industry and a more gradual acceleration expected after 2024, influenced by ongoing macroeconomic challenges and issues in China. Additionally, Illumina's management plans to increase operating margins by approximately 500 basis points by 2027, which is less ambitious than we had previously anticipated, as their approach to reducing the research and development budget appears to be more conservative than we hoped. Consequently, we now forecast mid-teens adjusted EPS growth compounded annually from 2024 to 2033, a decrease from our earlier expectation of over 20%.
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