Ironwood Pharmaceuticals (NASDAQ:IRWD) Trading 7.8% Higher - Still a Buy?

Key Points

• Shares jumped 7.8% to about $4.35 intraday (high $4.32) on Wednesday, but trading volume was roughly 807,795 shares—about 81% below its average; market cap is roughly $705 million.
• Analyst coverage is mixed (one Strong Buy, two Buy, three Hold, one Sell) and the consensus rating is Hold with an average price target of $6.23.
• Ironwood missed quarterly expectations—EPS ($0.01) vs. $0.02 estimate and revenue $47.71M vs. $86.10M—and director Alexander J. Denner sold 6.73M shares (a ~42% reduction), even as several institutional investors have recently increased holdings.

Ironwood Pharmaceuticals, Inc. (NASDAQ:IRWD - Get Free Report)'s share price was up 7.8% during trading on Wednesday . The company traded as high as $4.32 and last traded at $4.3540. Approximately 807,795 shares traded hands during mid-day trading, a decline of 81% from the average daily volume of 4,264,050 shares. The stock had previously closed at $4.04.

Analyst Upgrades and Downgrades

Several brokerages have recently issued reports on IRWD. Citigroup upgraded shares of Ironwood Pharmaceuticals from a "market perform" rating to an "outperform" rating in a report on Monday, January 5th. Zacks Research cut shares of Ironwood Pharmaceuticals from a "strong-buy" rating to a "hold" rating in a research report on Wednesday, February 25th. Craig Hallum raised shares of Ironwood Pharmaceuticals from a "hold" rating to a "strong-buy" rating in a research note on Monday, January 5th. Wells Fargo & Company increased their target price on shares of Ironwood Pharmaceuticals from $3.00 to $5.00 and gave the stock an "equal weight" rating in a report on Monday, January 5th. Finally, Weiss Ratings restated a "sell (d)" rating on shares of Ironwood Pharmaceuticals in a report on Monday, December 29th. One analyst has rated the stock with a Strong Buy rating, two have given a Buy rating, three have assigned a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company presently has a consensus rating of "Hold" and an average price target of $6.23.

Ironwood Pharmaceuticals Stock Performance

The firm has a market capitalization of $705.23 million, a PE ratio of 33.27 and a beta of 0.17. The stock's 50-day simple moving average is $3.76 and its 200-day simple moving average is $3.34.

Ironwood Pharmaceuticals (NASDAQ:IRWD - Get Free Report) last issued its quarterly earnings data on Wednesday, February 25th. The biotechnology company reported ($0.01) EPS for the quarter, missing the consensus estimate of $0.02 by ($0.03). Ironwood Pharmaceuticals had a negative return on equity of 13.72% and a net margin of 8.11%.The company had revenue of $47.71 million during the quarter, compared to analysts' expectations of $86.10 million. As a group, analysts predict that Ironwood Pharmaceuticals, Inc. will post 0.1 earnings per share for the current fiscal year.

Insider Buying and Selling at Ironwood Pharmaceuticals

In related news, Director Alexander J. Denner sold 6,730,800 shares of the company's stock in a transaction on Tuesday, March 17th. The stock was sold at an average price of $3.05, for a total value of $20,528,940.00. Following the sale, the director directly owned 9,188,635 shares of the company's stock, valued at $28,025,336.75. This represents a 42.28% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. 12.70% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

Institutional investors have recently modified their holdings of the business. Bank of America Corp DE increased its stake in shares of Ironwood Pharmaceuticals by 248.3% during the third quarter. Bank of America Corp DE now owns 11,695,544 shares of the biotechnology company's stock valued at $15,321,000 after purchasing an additional 8,337,672 shares in the last quarter. Millennium Management LLC grew its stake in shares of Ironwood Pharmaceuticals by 186.6% in the 1st quarter. Millennium Management LLC now owns 6,359,682 shares of the biotechnology company's stock worth $9,349,000 after buying an additional 4,140,439 shares during the last quarter. AQR Capital Management LLC increased its position in Ironwood Pharmaceuticals by 144.3% during the 2nd quarter. AQR Capital Management LLC now owns 6,165,637 shares of the biotechnology company's stock valued at $4,422,000 after buying an additional 3,641,762 shares in the last quarter. Marshall Wace LLP raised its stake in Ironwood Pharmaceuticals by 616.3% during the second quarter. Marshall Wace LLP now owns 3,993,557 shares of the biotechnology company's stock valued at $2,875,000 after buying an additional 3,436,036 shares during the last quarter. Finally, Jane Street Group LLC boosted its holdings in Ironwood Pharmaceuticals by 740.5% in the first quarter. Jane Street Group LLC now owns 3,510,117 shares of the biotechnology company's stock worth $5,160,000 after acquiring an additional 3,092,475 shares in the last quarter.

Ironwood Pharmaceuticals Company Profile

Ironwood Pharmaceuticals, Inc is a commercial‐stage biotechnology company focused on the discovery, development and commercialization of medicines for gastrointestinal (GI) disorders. The company's flagship product is linaclotide, marketed under the brand name LINZESS in the United States for the treatment of irritable bowel syndrome with constipation (IBS-C) and chronic idiopathic constipation (CIC). Through a strategic collaboration with Allergan (now part of AbbVie), Ironwood also commercializes linaclotide in select ex-U.S.

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