Moderna stock is nearing a record high and a potential breakout after the company called for $18.4 billion in full-year sales of its Covid vaccine.
Moderna (MRNA), Pfizer (PFE) with BioNTech (BNTX) and Johnson & Johnson (JNJ) all have Food and Drug Administration-authorized Covid-19 vaccines. The FDA also recently agreed to new stability requirements and increased the maximum number of doses per Moderna vial — helping bolster mass inoculation efforts.
Experts and Moderna Chief Executive Stephane Bancel agree. There’s a chance Covid-19 could be an endemic disease, similar to the flu. To that end, Moderna is already testing several approaches to boosting its vaccine, including one aims to specifically target a mutation first found in South Africa.
Moderna also raised its manufacturing goals on April 29. The company expects to make 800 million to 1 billion doses of its vaccine this year. Next year, the company expects to make 3 billion. That number is flexible depending on the mix of smaller doses for boosters and pediatric shots.
“We are going to live with this virus, we think, forever,” Bancel said during the annual J.P. Morgan Health Care Conference in January.
So, is MRNA stock a buy now amid its coronavirus vaccine efforts?
A Fundamental Look At Moderna Stock
The type of coronavirus that causes Covid-19, dubbed SARS-CoV-2, is covered in so-called spike proteins. Moderna’s coronavirus vaccine contains mRNA that tells the body to produce a structure similar to the spike protein. The idea is that this will trigger the immune system to create disease-fighting antibodies and T-cells.
But Moderna isn’t profitable yet. So far, the company has reported losses every year since its start in 2016.
This takes MRNA stock out of the CAN SLIM threshold. Savvy investors are advised to seek stocks with recent 20%-25% quarterly sales and earnings growth. The bigger that growth, the better. It will be key to watch whether Moderna’s vaccine efforts ultimately pay off on the bottom line.
In the fourth quarter, Moderna reported a 69-cent per-share loss on $570.75 million in sales. Losses grew year over year and were bigger than expected. But sales demolished expectations for $279.4 million and skyrocketed vs. the year-ago period.
Moderna stock has a Composite Rating of 65 out of a best-possible 99. The Composite Rating is a 1-99 measure of a stock’s key fundamental and technical measures. So Moderna stock outranks 65% of all stocks on those metrics.
What Does 2020 Say About MRNA Stock?
Moderna stock went public at 23 in late 2018.
In 2019, the biotech stock popped about 38%. In 2020, though, shares rocketed more than 434%.
Still, the bullish Moderna stock action does not extend to fundamental measures. In 2020, Moderna reported a loss of $1.96 per share on $803 million in sales. Sales soared, but losses deepened.
In 2021, analysts expect Moderna to be solidly profitable with rapidly accelerating revenue.
Moderna Stock: Technical Analysis
Shares also have a strong Relative Strength Rating of 95 out of a best-possible 99. The RS Rating is a 1-99 measure of a stock’s 12-month performance. This puts Moderna stock in the top 5% of all stocks on that metric.
But Moderna stock has a poor EPS Rating of 8, reflecting years of continuing per-share losses.
Keep tabs on IBD Digital for more on stock ratings.
Covid Vaccine Boosts Shares
At a final analysis, Moderna’s Covid vaccine was 94.1% effective. The analysis took accounted for 196 cases of Covid-19. Of those, 185 occurred in the placebo group. There were no severe cases of Covid-19 among those who received the vaccine.
The vaccine is relatively safe. Severe side effects included injection site pain in 2.7% of participants following the first dose. Between 2% and 9.7% of participants reported fatigue, muscle pain, joint pain, headache, general pain and injection site pain/redness following the second dose.
The FDA authorized the Covid-19 vaccine after an advisory committee voted 20-0, agreeing that its benefits outweighed its risks. One panelist abstained.
In March, the Centers for Disease Control and Prevention said a study of health care workers in the U.S. showed Pfizer’s and Moderna’s vaccines are 80% effective after the first dose. The second dose increases the effectiveness to 90%.
Early this month, the FDA said it would allow Moderna’s vaccine to be stored for 24 hours at room temperature. Further, a punctured vial is now considered usable for up to 12 hours, up from prior guidance for six hours. Workers can also get 15 doses from two vials, up from 11 previously.
Early testing has been promising for Moderna’s vaccine specific to the South Africa variant. It’s also looking at various regimens to boost its current regimen, in addition to examining whether the variant-specific shot can be used alone or in a combination as the primary vaccination.
Moderna also is testing its coronavirus vaccine in adolescents and children. News of the latter study on March 16 sent Moderna stock higher.
Moderna shares also rose 7.4% on April 13 after U.S. regulators paused use of Johnson & Johnson’s competing Covid vaccine while investigating reports of blood clots in some recipients.
So, Is Moderna Stock A Buy Right Now?
Moderna stock is not a buy right now.
The company has managed to put together a streak of sales growth. That’s expected to continue in the future. Further, beginning in early 2021, Moderna is expected to be solidly profitable.
Shares have a strong RS Rating, but the company’s Composite Rating isn’t among the upper echelon of stocks.
It will be important to watch Moderna’s efforts to distribute its coronavirus vaccine. That could help stoke both MRNA stock and the biotech company’s financials.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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