This trade activity should not be overlooked: Ardelyx Inc. (ARDX)

Ardelyx Inc. (NASDAQ: ARDX) stock fell -4.32% on Wednesday to $1.77 against a previous-day closing price of $1.85. With 7.83 million shares changed hands, the volume of the stock remained lighter than its average volume of 8.14 million shares. During the session, the Biotechnology company that operates in wider Healthcare sector, reached to the highest price of $1.8550 whereas the lowest price it dropped to was $1.7600. The 52-week range on ARDX shows that it touched its highest point at $2.19 and its lowest point at $0.49 during that stretch. It currently has a 1-year price target of $5.85. Beta for the stock currently stands at 1.45.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of ARDX was up-trending over the past week, with a rise of 45.08%, but this was up by 23.78% over a month. Three-month performance surged to 68.57% while six-month performance rose 197.48%. The stock gained 90.02% in the past year, while it has gained 60.91% so far this year. A look at the trailing 12-month EPS for ARDX yields -0.85 with Next year EPS estimates of -0.46. For the next quarter, that number is -0.02. This implies an EPS growth rate of -44.20% for this year and 11.50% for next year. EPS is expected to grow by 30.00% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 11.50%.

Float and Shares Shorts:

At present, 187.46 million ARDX shares are outstanding with a float of 182.86 million shares on hand for trading. On Oct 30, 2022, short shares totaled 7.34 million, which was 3.91% higher than short shares on Sep 29, 2022. In addition to Mr. Michael G. Raab as the firm’s Pres, CEO & Director, Mr. Justin A. Renz CPA, M.S.T., MBA, MST serves as its CFO & Treasurer.

Institutional Ownership:

Through their ownership of 36.56% of ARDX’s outstanding shares, institutional investors have minority control over the company. Other institutions hold 8.78% of ARDX, in contrast to 34.52% held by mutual funds. Shares owned by individuals account for 16.66%. As the largest shareholder in ARDX with 9.61% of the stake, Deep Track Capital LP holds 14,858,000 shares worth 14,858,000. A second-largest stockholder of ARDX, Janus Henderson Investors US LLC, holds 8,253,378 shares, controlling over 5.34% of the firm’s shares. The Vanguard Group, Inc. is the third largest shareholder in ARDX, holding 5,686,987 shares or 3.68% stake. With a 2.55% stake in ARDX, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 3,943,409 shares are owned by the mutual fund manager. The Vanguard Extended Market Index Fu, which owns about 1.18% of ARDX stock, is the second-largest Mutual Fund holder. It holds 1,818,581 shares valued at 2.73 million. Candoris ICAV – Orchard US Small holds 0.79% of the stake in ARDX, owning 1,220,809 shares worth 1.83 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Sep 29, 2022, ARDX reported revenue of $2.53M and operating income of -$26.21M. The EBITDA in the recently reported quarter was -$25.97M and diluted EPS was -$0.19.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for ARDX since 7 analysts follow the stock currently. There are 5 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 2 believe that the stock is worth HOLDING, 0 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With ARDX analysts setting a high price target of $8.00 and a low target of $1.60, the average target price over the next 12 months is $5.18. Based on these targets, ARDX could surge 351.98% to reach the target high and fall by -9.6% to reach the target low. Reaching the average price target will result in a growth of 192.66% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. ARDX will report FY 2022 earnings on 03/08/2023. Analysts have provided yearly estimates in a range of -$0.38 being high and -$0.77 being low. For ARDX, this leads to a yearly average estimate of -$0.55. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Ardelyx Inc. surprised analysts by $0.03 when it reported -$0.14 EPS against a consensus estimate of -$0.17. The surprise factor in the prior quarter was $0.00. Based on analyst estimates, the high estimate for the next quarter is $0.10 and the low estimate is -$0.18. The average estimate for the next quarter is thus -$0.02.

Summary of Insider Activity:

Insiders traded ARDX stock several times over the past three months with 6 Buys and 3 Sells. In these transactions, 18,000 shares were bought while 124,842 shares were sold. The number of buy transactions has increased to 19 while that of sell transactions has risen to 67 over the past year. The total number of shares bought during that period was 1,199,675 while 6,359,692 shares were sold.

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