Shares of Moderna were up 66% in January as the coronavirus vaccine was approved in many countries, including the United States.
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Modern (MRNA) joined Pfizer (PFE) and partner BioNTech (BNTX) with a Food and Drug Administration-approved Covid-19 vaccine in December. Both vaccines use messenger RNA technology to elicit an immune response.
At the annual JP Morgan Healthcare Conference, Chief Executive Stéphane Bancel said the company is licensed in more than 30 countries. That includes Switzerland, the United Kingdom, Europe and Israel. This is Moderna’s first commercial product.
Moderna’s shares hit a record high on Dec. 1 after the company said the Covid-19 vaccine was 94.1% effective in a phase 3 trial. In comparison, Pfizer and BioNTech say their coronavirus drug was found to be 95% effective in final stage testing.
Moderna is on track to make 600 million doses of its coronavirus vaccine this year, Bancel said. The company is now adding staff in hopes of reaching 1 billion doses this year and 1.2 billion doses by 2022. This is essential because Covid-19 will no longer exist, Bancel predicted.
“We will live with this virus forever, we think,” he said.
So, is MRNA stock now a buy in the midst of coronavirus vaccination efforts?
A fundamental take on Moderna stocks
The biotech company relies on its promising messenger RNA or mRNA technology. Messenger RNA is a substance in the body that provides the instructions for making proteins.
The type of coronavirus that causes Covid-19, called 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 prompts the immune system to produce disease-fighting antibodies and T cells.
But Moderna is not yet profitable. So far, the company has reported losses every year since its inception in 2016. Furthermore, Moderna’s income is variable and depends on collaboration and subsidy money.
This removes the MRNA stock from the CAN SLIM threshold. Savvy investors are advised to look for stocks with recent 20% -25% quarterly sales and earnings growth. The greater that growth, the better. It will be critical to see if Moderna’s vaccination efforts eventually pay off.
In the third quarter, Moderna reported a loss of 55 cents a share on $ 157.9 million in revenue. That follows a loss of 37 cents and sales of $ 17 million in the same period a year ago. For the fourth quarter, analysts polled by FactSet expect a loss of 34 cents a share and $ 279.4 million in revenue.
Moderna stock has a composite rating of 77 out of a best possible 99. The composite rating is a 1-99 measure of a stock’s key fundamental and technical measures. The Moderna stock is therefore narrowly in the top a quarter of all stocks based on those statistics.
What does 2019 say about MRNA shares?
The Moderna share went on an IPO 23 at the end of 2018.
In 2019, biotech stock fell by about 38%. In 2020, however, shares skyrocketed by more than 434%.
Still, Moderna’s bullish stock action doesn’t extend to fundamental measures. In 2019, Moderna reported a loss of $ 1.55 per share on $ 60 million in revenue. The losses have been increasing every year over the four full years, and revenues have now declined for two years.
For 2020, analysts polled by FactSet expect a loss of $ 1.57 per share on $ 530 million in revenue. Losses are expected to decrease slightly as sales skyrocket by 783%. Analysts expect Moderna to be solidly profitable in 2021 with rapidly increasing revenues.
Moderna Stock: Technical analysis
Moderna shares broke from a cup base with a buy point at 178.60 on Jan. 29. But on Feb. 1, the stocks tumbled below their entrance, according to MarketSmith.com. That led to a sell rule when a stock falls 7% -8% below its buy point.
Following the bullish coronavirus vaccine news on Nov. 16, Moderna’s stock broke out sharply. The biotech stock hit a buying point at 95.31 from a consolidation. Shares hit an all-time high that day at 100.13, but soon met resistance and started to dip below their breakthrough point.
Moderna stock broke that record on the last three trading days of November. Stocks hit a new record on December 1, but fell quickly on the news Merck (MRK) had divested its equity investment in MRNA shares. Shares plummeted due to an analyst downward rating on Dec. 9.
Progress by other Covid-19 vaccine makers has also weighed on Moderna’s stock from time to time. In September, AstraZeneca (AZN) stopped the Phase 3 Covid-19 vaccine test when a participant became seriously ill. However, the investigation was restarted in October.
Sign a promise
Moderna and AstraZeneca are among the nine leading Covid-19 vaccine manufacturers who have signed a pledge to follow science and safety in their development efforts. This came when the US and other political leaders called for a vaccine as soon as possible to help troubled economies and ease social unrest.
Moderna stock fell 13% on Sept. 8 to a four-month low after Moderna signed that pledge. Investors should be wary. It will be critical to keep an eye out for regulatory and commercial evidence of its technology, as well as strong fundamental and technical markings.
Bullishly, MRNA stocks have a strong Relative Strength Rating of 98. The RS Rating is a 1-99 rating of a stock’s performance over 12 months. This places Moderna in the top 2% of all stocks – regardless of industry group – in terms of performance.
But Moderna stocks have a poor EPS rating of 19, reflecting years of sustained losses per share.
(RELATED: Keep an eye out for Investor’s Business Daily reviews every day by visiting IBD Digital.)
Coronavirus vaccine news on MRNA stock
Moderna set a record in early 2020 when it created an experimental coronavirus vaccine within 42 days of receiving the genetic sequence of the virus from researchers in China. The National Institute of Allergy and Infectious Diseases conducted the phase 1 study in healthy volunteers.
That news caused MRNA stock to jump nearly 28% in one day last February.
In mid-March, MRNA stock rose by more than 15% after the biotech company said it dosed the first participant in a phase 1 study of the coronavirus vaccine. This was Moderna’s 10th infectious disease vaccine to initiate a clinical trial.
The Moderna stock jumped on May 18 after the biotech company said its coronavirus vaccine showed positive interim results in the phase 1 trial. Researchers tested the vaccine in participants aged 18-55.
All participants developed antibodies to SARS-CoV-2 two weeks after receiving a second injection of the low-dose vaccine. The medium dose produced even more antibodies. But Moderna’s shares fell more than 10% the next day after the biotech announced a public equity offering.
On July 14, Moderna revealed additional “robust” data from that same study. Notably, the medium dose generated 2.1-fold to 4.1-fold the neutralizing antibodies seen in recovered Covid-19 patients. Moderna plans to investigate that dose size at a late stage.
Phase 3 test proves 94.1% effective
In mid-November, Moderna unveiled an interim analysis of the phase 3 test, which said the vaccine was found to be 94.5% effective. The analysis was based on a study of 95 cases of Covid-19, which began two weeks after the participants received the second injection. Of those cases, only five came from the vaccine group.
A second analysis looked at 11 serious cases of Covid-19. All 11 were from the placebo group.
On Nov. 30, Moderna said his coronavirus vaccine was 94.1% effective in his latest phase 3 analysis. Of the 196 cases of Covid-19, 185 occurred in the placebo group. Only 11 were from the placebo group. There were no serious cases of Covid-19 among those who received the vaccine.
The vaccine appears to be relatively safe so far. Serious side effects included pain at the injection site in 2.7% of the participants after the first dose. Between 2% and 9.7% of the participants reported fatigue, muscle pain, joint pain, headache, general pain, and pain / redness at the injection site after the second dose.
On December 15, the FDA briefing documents said that Moderna’s coronavirus vaccine “met predefined success criteria” in clinical trials. Two days later, an advisory committee said the benefits of the vaccine outweigh the risks in a vote of 20-0. One panelist abstained.
The coronavirus vaccine was cleared the next day.
Johnson & Johnson (JNJ), Novavax (NVAX) recently reported Phase 3 results for their rival coronavirus vaccines. J & J’s single vaccine was 66% effective in preventing Covid-19. Novavax’s two-step regimen was 89.3% effective against the virus.
And Moderna isn’t the only company using mRNA technology. BioNTech is also a pioneer in the field of mRNA. And Translate Bio (TBIO) is also following the mRNA approach of the Covid-19 vaccine with which it collaborates Sanofi (CUT).
So, is Moderna stock a buy now?
Moderna shares are currently not for sale.
The shares tumbled well below their subscription on February 1, triggering a sell rule. CAN SLIM investors are advised to buy a stock when it has cleared a buy point and is within the 5% chase zone.
The company has managed to deliver two quarters of triple sales growth. That is expected to continue in the future. Furthermore, Moderna is expected to be solidly profitable from early 2021.
The Moderna stock was well above the 50-day and 200-day relocation lines on February 3.
Stocks have a bullish RS rating, but the company’s Composite Rating is not in the top echelon of stocks.
It will be important to watch Moderna’s efforts to spread its coronavirus vaccine. That could help boost MRNA stocks as well as the biotech company’s financial data.
To find the best stocks to buy and view, visit IBD Stock Lists. Make sure to also keep track of the stock you want to buy or sell.
Follow Allison Gatlin on Twitter at @BuienRadarNL.
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