Ironwood Pharmaceuticals, Inc.
Ironwood Pharmaceuticals, Inc. Fundamental Analysis
Ironwood Pharmaceuticals, Inc. (IRWD) shows weak financial fundamentals with a PE ratio of 21.22, profit margin of 8.42%, and ROE of -9.46%. The company generates $0.3B in annual revenue with weak year-over-year growth of -20.63%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 25.2/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze IRWD's fundamental strength across five key dimensions:
Efficiency Score
WeakIRWD struggles to generate sufficient returns from assets.
Valuation Score
ExcellentIRWD trades at attractive valuation levels.
Growth Score
WeakIRWD faces weak or negative growth trends.
Financial Health Score
ExcellentIRWD maintains a strong and stable balance sheet.
Profitability Score
WeakIRWD struggles to sustain strong margins.
Key Financial Metrics
Is IRWD Expensive or Cheap?
P/E Ratio
IRWD trades at 21.22 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, IRWD's PEG of 0.04 indicates potential undervaluation.
Price to Book
The market values Ironwood Pharmaceuticals, Inc. at -2.29 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 1.02 times EBITDA. This is generally considered low.
How Well Does IRWD Make Money?
Net Profit Margin
For every $100 in sales, Ironwood Pharmaceuticals, Inc. keeps $8.42 as profit after all expenses.
Operating Margin
Core operations generate 36.34 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $-9.46 in profit for every $100 of shareholder equity.
ROA
Ironwood Pharmaceuticals, Inc. generates $7.21 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Ironwood Pharmaceuticals, Inc. produces operating cash flow of $67.88M, showing steady but balanced cash generation.
Free Cash Flow
Ironwood Pharmaceuticals, Inc. generates strong free cash flow of $67.84M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $0.42 in free cash annually.
FCF Yield
IRWD converts 11.10% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
21.22
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.04
vs 25 benchmark
P/B Ratio
Price to book value ratio
-2.29
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.79
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
-2.26
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.13
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
-0.09
vs 25 benchmark
ROA
Return on assets percentage
0.07
vs 25 benchmark
ROCE
Return on capital employed
0.80
vs 25 benchmark
How IRWD Stacks Against Its Sector Peers
| Metric | IRWD Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 21.22 | 29.28 | Better (Cheaper) |
| ROE | -9.46% | 820.00% | Weak |
| Net Margin | 8.42% | -19731.00% (disorted) | Weak |
| Debt/Equity | -2.26 | 0.26 | Strong (Low Leverage) |
| Current Ratio | 1.13 | 4.69 | Neutral |
| ROA | 7.21% | -17993.00% (disorted) | Weak |
IRWD outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Ironwood Pharmaceuticals, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-19.55%
Industry Style: Defensive, Growth, Innovation
DecliningEPS CAGR
-95.99%
Industry Style: Defensive, Growth, Innovation
DecliningFCF CAGR
846.92%
Industry Style: Defensive, Growth, Innovation
High Growth