Ionis Stock Has Plunged 30%. Is It Time to Buy the Beaten-Down Stock?

Shares of Ionis Pharmaceuticals (NASDAQ: IONS) fell from about $86 in July to roughly $56 today, and are down about 30% year to date. The drop can be traced back to its heart drug Eplontersen failing to prove its efficacy, but it's just one symptom in a vast array of potential issues outlined in its recent second-quarter report.

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For investors who've watched the RNA-therapeutics pioneer finally reach commercial-stage milestones, the drop raises an obvious question: Is this an overreaction, or is the easy money already made?

Let's see what the numbers tell us.

Q2 2026: Bad news on top of bad news

The company's Q2 earnings report could have been much better.

Revenue came in at $268 million, down from $452 million year over year, or a roughly 41% decline. On the surface, that looks bad. But consider this: $280 million of that Q2 2025 revenue was from an upfront, one-time payment from Ono Pharmaceuticals. If we strip that out, revenue actually grew roughly 56% year over year.

And yet, the company reported a $115 million net loss compared with net income of $124 million last year. Ionis is ramping up commercialization and pipeline advancements, so losses at this juncture are nothing new. They're also not an immediate turn-off, especially considering the potential worth of its blockbuster drugs in the future.

Investors, however, remain uneasy about the slow reimbursement rollout for its newly approved drug, Tryngolza, which is targeted at high levels of fat in the blood. It also doesn't help that there's intensifying competition from rival Arrowhead Pharmaceuticals in the hypertriglyceridemia market, which is now showing potentially stronger efficacy in late-stage trials.

Overall, the headline looks ugly, and, of course, the market reacted badly to the surprise and uncertainty. Still, we can't discount the good news that came with the bad.

Tryngolza gets landmark FDA approval, Dawnzera starts ramping

On June 24, Tryngolza got Food & Drug Administration approval for severe hypertriglyceridemia "to reduce triglycerides and the risk of acute pancreatitis in adults with severe hypertriglyceridemia."

The approval takes Tryngolza beyond a tiny, rare disease and into the much broader severe population, effectively expanding its applications and potential market.

And that's not the only good news.

Dawnzera, which prevents hereditary angioedema attacks in patients aged 12 and up, showed a 63% sequential increase in sales. August 2026 marks the drug's first full year on the market, and the growth suggests Dawnzera could become a meaningful contributor to the company's revenue over time.

Lastly, despite the Eplontersen trial miss, management reaffirmed its full-year 2026 revenue projection of $875 million to $900 million, with Tryngolza and Dawnzera leading sales forecasts.

But the bigger question remains: Does Wall Street believe Ionis will eventually reach profitability?

The word on the street: Analysts' scores suggest an optimistic outlook

Despite the drug trial miss, Wall Street remains bullish on Ionis stock. It maintains a strong buy rating with a high target price of $115, suggesting the stock could more than double during the next year.

But there's an important caveat here. Analyst optimism doesn't erase the risks that caused the sell-off in the first place. Ionis still has to prove that Tryngolza can gain traction in the much larger hypertriglyceridemia market and hold off competition from Arrowhead.

That makes the next few quarters particularly important. Investors will want to see whether Tryngolza's commercial ramp accelerates, whether Dawnzera can continue delivering sequential growth, and whether Ionis can maintain its revenue forecast despite the setback in the Eplontersen clinical trial.

If management can pull this off and every piece falls into place, then the latest sell-off will look like a severe overreaction -- and a golden opportunity. With the stock trading roughly 30% below where it started the year and analysts still seeing substantial upside, Ionis is certainly worth watching.

Rick Orford has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ionis Pharmaceuticals. The Motley Fool has a disclosure policy.