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Ionis Pharmaceuticals (IONS) Soars 6.8%: Is Further Upside Left in the Stock?

Zacks Equity Research
·2-min read

Ionis Pharmaceuticals IONS shares rallied 6.8% in the last trading session to close at $44.68. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 12.2% gain over the past four weeks.

This rise in share price is attributable to Ionis’ progress with the development and potential commercialization of its wholly-owned pipeline. Last week, the company expanded the licensing deal for its investigational hereditary angioedema (HAE) therapy, donidalorsen, with Otsuka Pharmaceutical in the Asia-Pacific Region. This agreement is an expansion of the licensing deal signed last year wherein Ionis granted exclusive grants to Otsuka to market donidalorsen in Europe.

In consideration of expanding the rights, Ionis will receive an upfront payment of $20 million and will also be eligible for milestone payments. The company will also be eligible to receive tiered royalties on the drug’s net sales, with terms similar to the previously-signed agreement for Europe (ranging from 20-30%).

This drug discovery and development company is expected to post quarterly loss of $1.04 per share in its upcoming report, which represents a year-over-year change of -73.3%. Revenues are expected to be $141.05 million, down 25% from the year-ago quarter.

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While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Ionis Pharmaceuticals, the consensus EPS estimate for the quarter has been revised 0.5% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on IONS going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Ionis Pharmaceuticals is part of the Zacks Medical - Drugs industry. Heron Therapeutics HRTX, another stock in the same industry, closed the last trading session 1.6% lower at $3.18. HRTX has returned -6.1% in the past month.

For Heron Therapeutics , the consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$0.04. This represents a change of +88.6% from what the company reported a year ago. Heron Therapeutics currently has a Zacks Rank of #2 (Buy).

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