What does the share price of a genomics company have to do with the president's State of the Union address? For Illumina (NASDAQ:ILMN), quite a bit.

Illumina's stock jumped 7% on Tuesday because of speculation that President Obama would push for sequencing 1 million genomes during his address to the nation. As it turned out, though, the president wasn't quite that specific and instead only referred to a "new Precision Medicine Initiative" to advance cures for diabetes and cancer. Shares of Illumina retreated the day after President Obama's speech.

Investors could be in for more action soon, however. Illumina provides its latest financial and operational update on Jan. 27. Here are three key things to watch for in that report.

1. No financial surprises
Jay Flatley, Illumina's CEO, already spilled the beans on the company's financial performance at the JP Morgan (NYSE:JPM) Healthcare Conference last week. He revealed that revenue for the recently completed fourth quarter was expected to be around $512 million -- a nice 32% year-over-year increase. Flatley also said that non-GAAP earnings per share should come in slightly higher than previous guidance.

As for the new year, Illumina projects revenue growth of 20% and non-GAAP earnings per share between $3.12 and $3.18. Analysts expect the upper end of that range.

With all of this information pre-released, there should be no financial surprises from Illumina in its earnings report. However, it's not totally unheard of for a company to provide further details after a sneak peek at quarterly results that cause concern. That being said, though, I expect Illumina's message to be consistent with what Jay Flatley provided at the JP Morgan conference. 

2. NextSeq and HiSeq trends
The NextSeq 500 desktop sequencing system has proven to be a big hit for Illumina. Even though it's roughly twice as expensive as the older MiSeq system, orders during 2014 were in the same ballpark as those for the 12 months following MiSeq's launch. 

An even greater star for Illumina, though, has been the HiSeq X Ten. It's the most powerful genomic sequencing system ever -- and can sequence over 18,000 human genomes in a year at a cost of $1,000 per genome. While President Obama didn't mention any names in his State of the Union reference to a new Precision Medicine Initiative, the HiSeq X Ten would likely play a key role if the effort gains traction.

Source: Illumina 

One important thing to watch is how Illumina maintains a balance between its different product lines. The NextSeq could steal some of MiSeq's sales, although Jay Flatley indicated that the company hasn't seen significant cannibalization thus far.

3. New markets
Illumina seems poised to make a huge splash in new markets. The alliance with Lockheed Martin (NYSE:LMT) to help countries incorporate genomic sequencing into their national health systems opens a door that could be very lucrative for both companies.

Expansion into forensic diagnostics should also play a role in Illumina's continued success. The forensics market currently tops $400 million and could reach $1 billion by 2020. Illumina will launch its system targeting this growth market within the next couple of months and already has orders for more than 10 units.

Jay Flatley thinks that oncology represents the fastest-growing diagnostics opportunity for Illumina. I agree. Pay close attention for any details about the company's strategy to address this focus area. Academic and pharmaceutical partnerships could help Illumina dominate the oncology genomics market.

Ready to break out?
For several months, Illumina's stock price has primarily bounced between $180 and $200 per share. Could the stock be ready to break out soon? Maybe.

The company's opportunities are tremendous -- but so is its valuation. Illumina's forward price-to-earnings multiple currently stands at 60. The company's outlook for 2015 is good, but in my opinion not good enough to justify the price tag of its shares.

On the other hand, Illumina is a pioneer in what amounts to a frontier in the world of healthcare. Leaders in uncharted waters sometimes can deserve their premium valuations. The report on Jan. 27 should give investors a better sense of how smooth -- or how choppy -- those uncharted waters will be.