Traders looking to invest in vaccine stocks faced a difficult decision at the start of the vaccine rollout in late 2020 and early 2021: which vaccine stock would be the best bet in the months and years to come? With Pfizer and BioNTech, Johnson & Johnson and Moderna all becoming available at once, there was no way to know for sure which investment would yield the greatest returns.
While it seemed like Pfizer & BioNTech’s vaccine was the real frontrunner at the beginning of the rollout, Moderna’s stock became the biggest winner. How did Moderna stock rise hundreds of percent while Pfizer oscillated around the same level during the peak of the pandemic?
The Efficacy of Moderna’s Vaccine and Booster Shots
More so than Pfizer & BioNTech and Johnson & Johnson’s vaccines, Moderna has been the vaccine labeled as the most effective against the rise of COVID-19 variants.
With the nationwide rollout of booster shots and the announcement that individuals are free to mix and match their manufacturers as they see fit, many pivoted toward Moderna’s vaccine that had higher efficacy claims — even if they had previously received Pfizer or J&J’s shot during the first go-round. This resulted in a boost in demand for Moderna’s vaccine but it’s not the only reason that MRNA share price popped.
The real reason for Moderna share price soaring can be found by examining its financials. Unlike Pfizer and Johnson & Johnson that had diversified pipelines of products, Moderna was essentially a one-hit wonder. Its MRNA vaccine catapulted revenues from almost nothing to billions faster than just about any other company in history. And investors quickly realized if its vaccine was effective in fighting COVID, the company could build an array of products to counter other viruses.
All it takes is one look at Moderna’s most recent quarter’s financials vs those a year prior to see just how significant this demand for Moderna truly is. The company saw quarterly revenue of $5.0 billion, which is a significant improvement over the $157 million Moderna saw for the same quarter the year prior.
Beyond this, Moderna’s total revenue for 3 quarters was an astounding $11.3 billion, which towers over the $232 million the company earned for the first nine months of the year before. While Moderna has a vast array of other pharmaceutical projects in various stages of development, there’s no doubt that these amazing financials are a direct result of their COVID shot and subsequent boosters.
How Much Has Moderna Made From the Vaccine?
Throughout the COVID-19 pandemic, Moderna has received close to $10 billion to cover the research and development of its treatment and the eventual purchase of 500 million doses.
This $10 billion from the US government allowed Moderna to cover the entire cost of the clinical development of the COVID-19 shot, eliminating the need for those costs to come out of the company’s pockets. This explains the massive profits the company has seen over the past several quarters.
Moderna’s Stock Price Forecast
Looking at Moderna’s stock price forecast is somewhat shocking because of how divided financial analysts are on the subject.
Bearish analysts peg the company’s stock at just $86 per share over the next twelve months, while bullish investors see Moderna’s price per share rising to $475 over the same period.
Given its limited pipeline of products and the vast disagreement among research analysts, there’s no doubt that Moderna remains a volatile stock with the potential for both high rewards and high risks.
Looking Ahead to Future Variants and Boosters
While Moderna’s vaccine and its boosters have been in extremely high demand over the last several years, the future of COVID-19 variants and the ongoing need for boosters will be the true test for the company.
Because the government bought so many Moderna doses, the shots being administered today have no real bearing on the company’s stock — it’s when that supply runs out that the real test begins. In short, the current news has been baked into the share price.
Looking ahead, this will be where Moderna stock will get a chance to skyrocket or plummet: whether or not there will be an ongoing demand in the years to come.
Risks Associated With Moderna Stock
If investing in vaccine war-winner Moderna is appealing to you, there are some risks you should consider. First and foremost is the aforementioned uncertainty surrounding what kind of demand there will be for COVID-19 shots in the future — not just Moderna’s, but all COVID-19 shots in general.
Another factor to consider is the effectiveness of Moderna against the omicron variant. While Moderna was propped up as a defense against the delta variant, there’s significant possibility that it could be less effective against omicron and other future variants.
Last but not least, Moderna still does not have full approval from the FDA like Pfizer & BioNTech’s vaccine does and if Moderna were to be denied full approval for whatever reason, this could hurt the company’s stock.
The Bottom Line: How Moderna Won the Vaccine Wars
When all is said and done, Moderna has been the clear winner of the vaccine wars. Its boosters are in high demand, its recent financials look stellar and its potential for future success is bright in spite of the risks.
Many uncertainties still linger in the air, to be sure, but for now, Moderna’s stock has a lot of positive and promising qualities that could easily bring success to investors’ portfolios in the coming years.