What happened
Shares of Novavax (NASDAQ: NVAX) were up 19.1% as of 12:08 p.m. EST on Monday. This big gain came after the stock skyrocketed on Friday following the announcement of positive late-stage results for the COVID-19 vaccine candidate NVX-CoV2373.
Today’s jump appears to be due in part to last week’s continued momentum. In addition, B. Riley Securities analyst Mayank Mamtani raised his price target for Novavax from $ 223 to $ 334, reflecting a 51% premium over Friday’s closing price.
So what
It is impossible to determine how much of Novavax’s current earnings came from Mamtani’s optimistic view of the biotech stock. However, the underlying reasons for his optimism seem to be clear.
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Mamtani wrote to investors that Novavax should have “significant competitive differentiation” in the COVID-19 vaccine market. The high efficacy of NVX-CoV2373 and its logistical advantages (including no ultra-cold storage requirements) should make it a major commercial winner, assuming the vaccine obtains regulatory authorizations.
The analyst also pointed out that Novavax has another vaccine candidate with a lot of potential. The company reported positive late-stage results from the experimental flu vaccine NanoFlu last year. Mamtani expects the biotech to gain significant market share in the fast-growing markets for COVID-19 and flu vaccines.
What now
There are now two major milestones to keep an eye on with Novavax. First, the company should be in a strong position to get approval for NVX-CoV2373 in the UK soon. Second, Novavax is conducting another late-stage study of the vaccine in the US and Mexico. The results of that study should be available within months.