IRONWOOD PHARMACEUTICALS INC (IRWD) Stock Fundamental Analysis
NASDAQ:IRWD - Nasdaq - US46333X1081 - Common Stock - Currency: USD
IRWD gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 566 industry peers in the Biotechnology industry. IRWD has an excellent profitability rating, but there are some minor concerns on its financial health. IRWD has a bad growth rate and is valued cheaply. This makes IRWD very considerable for value investing!
1. Profitability
1.1 Basic Checks
IRWD had positive earnings in the past year.
IRWD had a positive operating cash flow in the past year.
Of the past 5 years IRWD 4 years were profitable.
In the past 5 years IRWD always reported a positive cash flow from operatings.
1.2 Ratios
IRWD has a Return On Assets of 0.25%. This is amongst the best in the industry. IRWD outperforms 90.81% of its industry peers.
With an excellent Return On Invested Capital value of 24.23%, IRWD belongs to the best of the industry, outperforming 99.29% of the companies in the same industry.
IRWD had an Average Return On Invested Capital over the past 3 years of 36.95%. This is significantly above the industry average of 14.24%.
The last Return On Invested Capital (24.23%) for IRWD is well below the 3 year average (36.95%), which needs to be investigated, but indicates that IRWD had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.25% | ||
| ROE | N/A | ||
| ROIC | 24.23% |
ROA(3y)-65.53%
ROA(5y)-26.14%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)36.95%
ROIC(5y)30.66%
1.3 Margins
The Profit Margin of IRWD (0.25%) is better than 91.52% of its industry peers.
In the last couple of years the Profit Margin of IRWD has declined.
IRWD has a better Operating Margin (27.24%) than 97.35% of its industry peers.
IRWD's Operating Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.24% | ||
| PM (TTM) | 0.25% | ||
| GM | N/A |
OM growth 3Y-21.4%
OM growth 5Y0.07%
PM growth 3Y-87.48%
PM growth 5Y-45.09%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
IRWD has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
IRWD has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, IRWD has more shares outstanding
IRWD has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of -4.24, we must say that IRWD is in the distress zone and has some risk of bankruptcy.
IRWD has a Altman-Z score of -4.24. This is comparable to the rest of the industry: IRWD outperforms 42.40% of its industry peers.
IRWD has a debt to FCF ratio of 5.65. This is a neutral value as IRWD would need 5.65 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.65, IRWD belongs to the top of the industry, outperforming 93.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.65 | ||
| Altman-Z | -4.24 |
ROIC/WACC3.9
WACC6.22%
2.3 Liquidity
IRWD has a Current Ratio of 4.69. This indicates that IRWD is financially healthy and has no problem in meeting its short term obligations.
IRWD has a Current ratio of 4.69. This is comparable to the rest of the industry: IRWD outperforms 53.18% of its industry peers.
IRWD has a Quick Ratio of 4.69. This indicates that IRWD is financially healthy and has no problem in meeting its short term obligations.
IRWD has a Quick ratio of 4.69. This is comparable to the rest of the industry: IRWD outperforms 54.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 4.69 | ||
| Quick Ratio | 4.69 |
3. Growth
3.1 Past
IRWD shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -96.88%.
The earnings per share for IRWD have been decreasing by -48.27% on average. This is quite bad
The Revenue for IRWD has decreased by -20.63% in the past year. This is quite bad
The Revenue has been decreasing by -3.88% on average over the past years.
EPS 1Y (TTM)-96.87%
EPS 3Y-74.31%
EPS 5Y-48.27%
EPS Q2Q%300%
Revenue 1Y (TTM)-20.63%
Revenue growth 3Y-5.3%
Revenue growth 5Y-3.88%
Sales Q2Q%-22.98%
3.2 Future
IRWD is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 102.64% yearly.
The Revenue is expected to decrease by -1.17% on average over the next years.
EPS Next Y729.62%
EPS Next 2Y211.29%
EPS Next 3Y26.83%
EPS Next 5Y102.64%
Revenue Next Year-24.11%
Revenue Next 2Y-15.7%
Revenue Next 3Y-16.91%
Revenue Next 5Y-1.17%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 45.59, the valuation of IRWD can be described as expensive.
93.82% of the companies in the same industry are more expensive than IRWD, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of IRWD to the average of the S&P500 Index (27.85), we can say IRWD is valued expensively.
With a Price/Forward Earnings ratio of 5.50, the valuation of IRWD can be described as very cheap.
Based on the Price/Forward Earnings ratio, IRWD is valued cheaply inside the industry as 98.76% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 20.77. IRWD is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.6 | ||
| Fwd PE | 5.5 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of IRWD indicates a rather cheap valuation: IRWD is cheaper than 99.12% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, IRWD is valued cheaper than 100.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 1.43 | ||
| EV/EBITDA | 6.61 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
IRWD has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as IRWD's earnings are expected to grow with 26.83% in the coming years.
PEG (NY)0.06
PEG (5Y)N/A
EPS Next 2Y211.29%
EPS Next 3Y26.83%
5. Dividend
5.1 Amount
No dividends for IRWD!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
0.9119
-0.02 (-2.19%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryBiotechnology
Earnings (Last)
Earnings (Next)
Inst Owners104.57%
Inst Owner Change-0.32%
Ins Owners2.04%
Ins Owner Change4.41%
Market Cap147.56M
Analysts73.33
Price Target5.22 (472.43%)
Short Float %7.36%
Short Ratio3.44
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-75.31%
Min EPS beat(2)-75.67%
Max EPS beat(2)-74.94%
EPS beat(4)0
Avg EPS beat(4)-90.22%
Min EPS beat(4)-110.27%
Max EPS beat(4)-74.94%
EPS beat(8)2
Avg EPS beat(8)-60.67%
EPS beat(12)3
Avg EPS beat(12)-44.43%
EPS beat(16)6
Avg EPS beat(16)-30.92%
Revenue beat(2)0
Avg Revenue beat(2)-3.49%
Min Revenue beat(2)-5.38%
Max Revenue beat(2)-1.59%
Revenue beat(4)0
Avg Revenue beat(4)-12.78%
Min Revenue beat(4)-30.62%
Max Revenue beat(4)-1.59%
Revenue beat(8)2
Avg Revenue beat(8)-6.39%
Revenue beat(12)3
Avg Revenue beat(12)-5.46%
Revenue beat(16)5
Avg Revenue beat(16)-3.92%
PT rev (1m)-40.96%
PT rev (3m)-59.07%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-116.67%
EPS NY rev (1m)-6.15%
EPS NY rev (3m)-47.19%
Revenue NQ rev (1m)0.53%
Revenue NQ rev (3m)-21.68%
Revenue NY rev (1m)-6.19%
Revenue NY rev (3m)-22.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 45.6 | ||
| Fwd PE | 5.5 | ||
| P/S | 0.42 | ||
| P/FCF | 1.43 | ||
| P/OCF | 1.42 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.61 |
EPS(TTM)0.02
EY2.19%
EPS(NY)0.17
Fwd EY18.2%
FCF(TTM)0.64
FCFY70.08%
OCF(TTM)0.64
OCFY70.18%
SpS2.17
BVpS-1.86
TBVpS-1.88
PEG (NY)0.06
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.25% | ||
| ROE | N/A | ||
| ROCE | 30.67% | ||
| ROIC | 24.23% | ||
| ROICexc | 33.83% | ||
| ROICexgc | 34.27% | ||
| OM | 27.24% | ||
| PM (TTM) | 0.25% | ||
| GM | N/A | ||
| FCFM | 29.43% |
ROA(3y)-65.53%
ROA(5y)-26.14%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)36.95%
ROIC(5y)30.66%
ROICexc(3y)70.13%
ROICexc(5y)67.75%
ROICexgc(3y)71.88%
ROICexgc(5y)68.8%
ROCE(3y)46.77%
ROCE(5y)38.81%
ROICexcg growth 3Y-13.6%
ROICexcg growth 5Y-7.25%
ROICexc growth 3Y-13.97%
ROICexc growth 5Y-7.41%
OM growth 3Y-21.4%
OM growth 5Y0.07%
PM growth 3Y-87.48%
PM growth 5Y-45.09%
GM growth 3YN/A
GM growth 5YN/A
F-Score7
Asset Turnover1
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.65 | ||
| Debt/EBITDA | 5.98 | ||
| Cap/Depr | 7.06% | ||
| Cap/Sales | 0.04% | ||
| Interest Coverage | 2.94 | ||
| Cash Conversion | 105.96% | ||
| Profit Quality | 11750.8% | ||
| Current Ratio | 4.69 | ||
| Quick Ratio | 4.69 | ||
| Altman-Z | -4.24 |
F-Score7
WACC6.22%
ROIC/WACC3.9
Cap/Depr(3y)21726.6%
Cap/Depr(5y)13049.4%
Cap/Sales(3y)77.3%
Cap/Sales(5y)46.48%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-96.87%
EPS 3Y-74.31%
EPS 5Y-48.27%
EPS Q2Q%300%
EPS Next Y729.62%
EPS Next 2Y211.29%
EPS Next 3Y26.83%
EPS Next 5Y102.64%
Revenue 1Y (TTM)-20.63%
Revenue growth 3Y-5.3%
Revenue growth 5Y-3.88%
Sales Q2Q%-22.98%
Revenue Next Year-24.11%
Revenue Next 2Y-15.7%
Revenue Next 3Y-16.91%
Revenue Next 5Y-1.17%
EBIT growth 1Y-43.14%
EBIT growth 3Y-25.57%
EBIT growth 5Y-3.82%
EBIT Next Year0.35%
EBIT Next 3Y-26.54%
EBIT Next 5Y8.99%
FCF growth 1Y112.27%
FCF growth 3Y-26.61%
FCF growth 5Y96.83%
OCF growth 1Y-43.55%
OCF growth 3Y-26.6%
OCF growth 5Y57.45%