Value
9.6/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 10.0 |
| P/S | 9.3 |
| EV/EBITDA | 9.5 |
| Fwd P/E | 10.0 |
| PEG | 10.0 |
| Analyst target | 9.0 |
- ▸Forward P/E: 2.4x
- ▸PEG: 0.02
- ▸Attractively valued
IRWD · Why this verdict
Why Ironwood Pharmaceuticals (IRWD) is rated BUY WAIT
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. People who build TrendMatrix, or entities they control, may hold positions, long or short, in securities it covers, and may trade them at any time. Positions are not disclosed individually. Verdicts are generated by an automated model applied by the same rules to every covered stock, and are not adjusted for any position held by the people who build TrendMatrix. We do not accept payment from issuers for coverage.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictBUY WAIT
Overall score7.5/10
ConfidenceHIGH
MacroRISK_OFF
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Ironwood is a high-quality business with 33% margins, a Rule of 40 score of 64 (elite) and a 9/9 Piotroski score, ranking best in class on margins among peers. Quality breakdown | Margins stay near 33% and the Rule of 40 score stays above 50. | →Stable |
| CounterRevenue is lumpy, with a $47.7M quarter in December 2025 between quarters above $100M, so margins may not hold. | ||
The stock trades at a forward P/E of 2.3x with a PEG of 0.02, an extremely low multiple relative to growth. Valuation breakdown | Earnings growth continues so the forward P/E stays below 5x as the price recovers. | →Stable |
| CounterA multiple this low usually signals the market expects earnings to fall sharply or doubts the durability of revenue. | ||
Revenue is growing 33% year over year, with quarterly revenue of $113.0M in June 2026 versus $85.2M a year earlier. Growth breakdown | Quarterly revenue reaches the estimated $121.6M next quarter. | →Stable |
| CounterQuarterly revenue has swung between $41M and $122M over the past two years, so year-over-year growth depends on timing. | ||
At $3.46 the stock is 49.9% below the $5.18 analyst target, with 10.9% downside to the stop, a reward-to-risk of 4.6. Targets | Price moves toward the $5.18 analyst target as earnings are delivered. | →Stable |
| CounterThe stock is down 40% from its 52-week high with implied volatility of 122%, so analyst targets may be cut. | ||
Momentum is weak at 3.3/10, with price below the 200-day average, although that average is still rising 1.3% per 30 days, which points to a pullback rather than a confirmed downtrend. Momentum breakdown | Price reclaims the 200-day moving average and the momentum score rises above 4.5. | ↑Improving |
| CounterShort interest of 10% and a record of 1 miss and 2 beats in the last 4 quarters leave sentiment fragile. | ||
Ironwood is a high-quality business with 33% margins, a Rule of 40 score of 64 (elite) and a 9/9 Piotroski score, ranking best in class on margins among peers.
→StableQuality breakdown
- Expectation
- Margins stay near 33% and the Rule of 40 score stays above 50.
CounterRevenue is lumpy, with a $47.7M quarter in December 2025 between quarters above $100M, so margins may not hold.
The stock trades at a forward P/E of 2.3x with a PEG of 0.02, an extremely low multiple relative to growth.
→StableValuation breakdown
- Expectation
- Earnings growth continues so the forward P/E stays below 5x as the price recovers.
CounterA multiple this low usually signals the market expects earnings to fall sharply or doubts the durability of revenue.
Revenue is growing 33% year over year, with quarterly revenue of $113.0M in June 2026 versus $85.2M a year earlier.
→StableGrowth breakdown
- Expectation
- Quarterly revenue reaches the estimated $121.6M next quarter.
CounterQuarterly revenue has swung between $41M and $122M over the past two years, so year-over-year growth depends on timing.
At $3.46 the stock is 49.9% below the $5.18 analyst target, with 10.9% downside to the stop, a reward-to-risk of 4.6.
→StableTargets
- Expectation
- Price moves toward the $5.18 analyst target as earnings are delivered.
CounterThe stock is down 40% from its 52-week high with implied volatility of 122%, so analyst targets may be cut.
Momentum is weak at 3.3/10, with price below the 200-day average, although that average is still rising 1.3% per 30 days, which points to a pullback rather than a confirmed downtrend.
↑ImprovingMomentum breakdown
- Expectation
- Price reclaims the 200-day moving average and the momentum score rises above 4.5.
CounterShort interest of 10% and a record of 1 miss and 2 beats in the last 4 quarters leave sentiment fragile.
Per-dimension breakdown
Quality
8.9/10data confidence 100%| Component | Sub-score |
|---|---|
| ROA | 10.0 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 6.9 |
| FCF quality | 6.7 |
| Moat | 7.0 |
| Rule of 40 | 9.5 |
| Piotroski F | 10.0 |
- ▸Strong margins: 33%
- ▸Rule of 40: 64 (elite)
- ▸Strong Piotroski F-Score: 9/9
- ▸High-quality business
Growth
10.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 10.0 |
- ▸Strong growth: 33% YoY
Momentum
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.5 |
| MACD | 6.1 |
| OBV | 10.0 |
| MA position | 2.2 |
| Volume | 1.9 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA but MA still rising (+0.8%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 9.8 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 69%
Insider
6.6/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 7.7 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
7.6/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 8.4 |
| quality rank | 9.2 |
| growth rank | 7.9 |
- ▸Attractive P/E vs peers
- ▸Best-in-class margins
Technical
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.6 |
| support resistance | 6.1 |
| 52w position | 2.5 |
| gap | 6.0 |
Risk (lower is worse)
4.8/10data confidence 80%| Component | Sub-score |
|---|---|
| short interest | 4.8 |
| days to cover | 3.2 |
| volatility | 1.2 |
| beta | 10.0 |
Catalyst
3.9/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 5.6 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
- ▸Earnings in 6 days
How the verdict was assembled
Engine trigger
V9 Gate blocked: Earnings in 6 days (≤7d hard window). Wait for improvement.
Engine technical detail
verdict_path:
L4:PATH_A_VALUE_MOS33->V9:EARNINGS_PROXIMITY|ENTRY_STICKY:WITHIN_BANDPassed (8)
- MOMENTUM:4.7>=4.5
- ASYMMETRY:4.8>=1.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
- SECTOR_CONCENTRATION_CAP:sector=Healthcare:5/10
Failed (1)
- EARNINGS_PROXIMITY:6d<=7d
Warning (1)
- MOMENTUM:4.7<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
4.82
Upside
+43.6%
Downside
9.1%
Sizing output
STARTER
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($0.6B) below institutional reach
SuitabilityAggressive — MCap $0.6B<$5B
Investment implication
The STRONG_BUY_WAIT verdict reflects the EARNINGS_PROXIMITY gate's 6d<=7d outcome against Growth at 10.0 and asymmetric R:R of 4.82.
The strongest dimensions are Growth at 10.0, Value at 9.6, and Quality at 8.9; the weakest are Catalyst at 3.9, Momentum at 4.7, and Risk (lower is worse) at 4.8. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of 4.82 and an engine sizing output of STARTER.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Quality Elite Margins
Trip ifNet margin falls below 20% from the current 33%.
- P2Deep Value Low Multiple
Trip ifForward P/E rises above 8x from the current 2.3x.
- P3Strong Growth Lumpy Revenue
Trip ifQuarterly revenue falls below $85M from the latest $113.0M.
- P4Analyst Target Upside
Trip ifStock price falls below the $3.06 stop level from the current $3.46.
- P5Weak Momentum Pullback
Trip ifMomentum score stays below 3.0 for 2 consecutive months.