Ironwood Pharmaceuticals Current Valuation vs. Operating Margin

IRWD Stock  USD 3.56  0.13  3.52%   
Based on Ironwood Pharmaceuticals' profitability indicators, Ironwood Pharmaceuticals' profitability may be sliding down. It has an above-average odds of reporting lower numbers next quarter. Profitability indicators assess Ironwood Pharmaceuticals' ability to earn profits and add value for shareholders. At present, Ironwood Pharmaceuticals' Sales General And Administrative To Revenue is projected to slightly decrease based on the last few years of reporting. The current year's Operating Cash Flow Sales Ratio is expected to grow to 0.44, whereas EV To Sales is forecasted to decline to 5.15. At present, Ironwood Pharmaceuticals' Income Tax Expense is projected to increase significantly based on the last few years of reporting. The current year's Non Operating Income Net Other is expected to grow to about 9.2 M, whereas Income Before Tax is projected to grow to (900.7 M).
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.740.9964
Way Down
Very volatile
For Ironwood Pharmaceuticals profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Ironwood Pharmaceuticals to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Ironwood Pharmaceuticals utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Ironwood Pharmaceuticals's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Ironwood Pharmaceuticals over time as well as its relative position and ranking within its peers.
  

Ironwood Pharmaceuticals' Revenue Breakdown by Earning Segment

Check out Risk vs Return Analysis.
For information on how to trade Ironwood Stock refer to our How to Trade Ironwood Stock guide.
Is Biotechnology space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Ironwood Pharmaceuticals. If investors know Ironwood will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Ironwood Pharmaceuticals listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.77)
Earnings Share
(0.01)
Revenue Per Share
2.393
Quarterly Revenue Growth
(0.20)
Return On Assets
0.1305
The market value of Ironwood Pharmaceuticals is measured differently than its book value, which is the value of Ironwood that is recorded on the company's balance sheet. Investors also form their own opinion of Ironwood Pharmaceuticals' value that differs from its market value or its book value, called intrinsic value, which is Ironwood Pharmaceuticals' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Ironwood Pharmaceuticals' market value can be influenced by many factors that don't directly affect Ironwood Pharmaceuticals' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Ironwood Pharmaceuticals' value and its price as these two are different measures arrived at by different means. Investors typically determine if Ironwood Pharmaceuticals is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Ironwood Pharmaceuticals' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Ironwood Pharmaceuticals Operating Margin vs. Current Valuation Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Ironwood Pharmaceuticals's current stock value. Our valuation model uses many indicators to compare Ironwood Pharmaceuticals value to that of its competitors to determine the firm's financial worth.
Ironwood Pharmaceuticals is rated below average in current valuation category among its peers. It is rated fourth overall in operating margin category among its peers . The ratio of Current Valuation to Operating Margin for Ironwood Pharmaceuticals is about  3,988,453,235 . At present, Ironwood Pharmaceuticals' Operating Profit Margin is projected to slightly grow based on the last few years of reporting. Comparative valuation analysis is a catch-all technique that is used if you cannot value Ironwood Pharmaceuticals by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

Ironwood Current Valuation vs. Competition

Ironwood Pharmaceuticals is rated below average in current valuation category among its peers. After adjusting for long-term liabilities, total market size of Health Care industry is currently estimated at about 36.24 Billion. Ironwood Pharmaceuticals holds roughly 1.12 Billion in current valuation claiming about 3% of equities under Health Care industry.

Ironwood Operating Margin vs. Current Valuation

Enterprise Value is a firm valuation proxy that approximates the current market value of a company. It is typically used to determine the takeover or merger price of a firm. Unlike Market Cap, this measure takes into account the entire liquid asset, outstanding debt, and exotic equity instruments that the company has on its balance sheet. When a takeover occurs, the parent company will have to assume the target company's liabilities but will take possession of all cash and cash equivalents.

Ironwood Pharmaceuticals

Enterprise Value

 = 

Market Cap + Debt

-

Cash

 = 
1.12 B
Enterprise Value can be a useful tool to compare companies with different capital structures. Long term liability and current cash or cash equivalents can have a huge impact on market valuation of a given company.
Operating Margin shows how much operating income a company makes on each dollar of sales. It is one of the profitability indicators which helps analysts to understand whether the firm is successful or not making money from everyday operations.

Ironwood Pharmaceuticals

Operating Margin

 = 

Operating Income

Revenue

X

100

 = 
0.28 %
A good Operating Margin is required for a company to be able to pay for its fixed costs or payout its debt, which implies that the higher the margin, the better. This ratio is most effective in evaluating the earning potential of a company over time when comparing it against a firm's competitors.

Ironwood Operating Margin Comparison

Ironwood Pharmaceuticals is currently under evaluation in operating margin category among its peers.

Ironwood Pharmaceuticals Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Ironwood Pharmaceuticals, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Ironwood Pharmaceuticals will eventually generate negative long term returns. The profitability progress is the general direction of Ironwood Pharmaceuticals' change in net profit over the period of time. It can combine multiple indicators of Ironwood Pharmaceuticals, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-3 M-3.2 M
Operating Income209 M219.5 M
Income Before Tax-948.1 M-900.7 M
Total Other Income Expense Net-1.2 B-1.1 B
Net Loss-1 B-952.1 M
Income Tax Expense83.5 M87.7 M
Net Loss-980.9 M-931.9 M
Non Operating Income Net Other8.7 M9.2 M
Net Income Applicable To Common Shares201.3 M211.4 M
Interest Income23.2 M24.4 M
Net Interest Income8.5 M8.9 M
Change To Netincome82.3 M86.5 M
Net Loss(6.45)(6.13)
Income Quality(0.18)(0.17)
Net Income Per E B T 1.06  0.79 

Ironwood Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Ironwood Pharmaceuticals. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Ironwood Pharmaceuticals position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Ironwood Pharmaceuticals' important profitability drivers and their relationship over time.

Use Ironwood Pharmaceuticals in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Ironwood Pharmaceuticals position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ironwood Pharmaceuticals will appreciate offsetting losses from the drop in the long position's value.

Ironwood Pharmaceuticals Pair Trading

Ironwood Pharmaceuticals Pair Trading Analysis

The ability to find closely correlated positions to Ironwood Pharmaceuticals could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Ironwood Pharmaceuticals when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Ironwood Pharmaceuticals - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Ironwood Pharmaceuticals to buy it.
The correlation of Ironwood Pharmaceuticals is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Ironwood Pharmaceuticals moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Ironwood Pharmaceuticals moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Ironwood Pharmaceuticals can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Ironwood Pharmaceuticals position

In addition to having Ironwood Pharmaceuticals in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Corporate Bonds Funds Thematic Idea Now

Corporate Bonds Funds
Corporate Bonds Funds Theme
Funds or Etfs investing in different types of corporate debt instruments. The Corporate Bonds Funds theme has 46 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Corporate Bonds Funds Theme or any other thematic opportunities.
View All  Next Launch
When determining whether Ironwood Pharmaceuticals is a strong investment it is important to analyze Ironwood Pharmaceuticals' competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Ironwood Pharmaceuticals' future performance. For an informed investment choice regarding Ironwood Stock, refer to the following important reports:
Check out Risk vs Return Analysis.
For information on how to trade Ironwood Stock refer to our How to Trade Ironwood Stock guide.
You can also try the Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
To fully project Ironwood Pharmaceuticals' future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Ironwood Pharmaceuticals at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Ironwood Pharmaceuticals' income statement, its balance sheet, and the statement of cash flows.
Potential Ironwood Pharmaceuticals investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Ironwood Pharmaceuticals investors may work on each financial statement separately, they are all related. The changes in Ironwood Pharmaceuticals's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Ironwood Pharmaceuticals's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.