Despite the decline in global Covid-19 cases, and the expected gradual return to normalcy, fears of mutant strains remain.
Michael Yee, analyst at Jefferies, considers the specter of new variants to be one of the main reasons why Moderna (MRNA) is well placed to capitalize.
‘We strongly believe that in 2022+ MRNA will be about visibility, where variant vaccines’ 2.0′ are the focus, because the street fears that variants will disrupt recovery, and as long as there are variants, MRNA can benefit from it because it can quickly adjust and 2.0 and 3.0, ”says the analyst.
Since the emergence of the South African variant, for which Moderna’s Covid-19 vaccine m-RNA-1273 appears to be less effective, biotechnology has begun testing against the new variant; Yee expect ‘positive’ data in the summer. The analyst foresees a strong global effort to combat new strains, noting that some countries have already started placing orders for different vaccines.
A new variant or not, Yee believes the demand for Moderna’s vaccine is stronger than initially expected. When the company reports Q4 earnings this week (February 25), Yee expects the company’s prospects to materialize.
“In our opinion, MRNA has clearly emerged as a top player. We expect the lead to show this in 2021, including the potential for sales of $ 15-16 billion + (we increase to $ 15 billion) and much higher than that. investors thought six months ago, “Yee said. “It seems that MRNA’s manufacturing capacity is increasing nicely, as delivery in the US is being delayed by 1-2 months and MRNA will meet its 300 million commitment to the US by the end of July.”
Conversely, the analyst says some “valuation-sensitive investors” may be “frustrated” with Moderna’s $ 63 billion market capitalization. This undoubtedly means that expectations are high and that the multiple multiples and the massive appreciation of shares are cited as Yee’s reasons for maintaining a Hold rating on the shares.
That said, Yee has raised its price target from $ 150 to $ 180, indicating ~ 13% upside from current levels. (To see Yee’s record, click here)
The rest of the street leans carefully towards the positive side. The consensus rating of MRNA for Moderate Buy is based on 6 Buy Ratings, 4 Holdings and 2 Sells. There may be an 8% increase if the target of $ 172.09 is reached in the coming year. (See MRNA stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are those of the proposed analyst. The content is for informational purposes only. It is very important to do your own analysis before investing.