By Ciara Linnane
After a dismal 2023, analysts are more optimistic about pipeline progress
Moderna Inc. shares soared 13% on Tuesday to lead the S&P 500 index gains, after Oppenheimer upgraded the stock to the equivalent of buy and said he expects the biotech to have five approved products by 2026.
Analysts led by Hartaj Singh upgraded the stock (MRNA) to outperform and said they expect it to perform better this year than the dismal result recorded in 2023.
The company currently only has one approved product, its mRNA-based COVID-19 vaccine, which has already surpassed peak sales. But it has several promising products in its pipeline, including vaccines against influenza and RSV, or respiratory syncytial virus, which Oppenheimer expects to gain regulatory approval in the medium term.
"We see top-line sales starting to grow in 2025E, with multiple product launches in the next 12 to 18 months (RSV, Influenza). We also expect material clinical and regulatory catalysts (INT, CMV) in this time frame, which makes us optimistic. the name again," the analysts wrote in a note to clients.
CMV, or cytomegalovirus, is a member of the herpes family. Moderna is also developing a cancer vaccine that will initially target melanoma patients.
See also: Moderna Stock Boosted by Positive Melanoma Treatment Trial Data Combined with Merck's Keytruda
Oppenheimer downgraded Moderna in August due to concerns about the pipeline's progress, but said the company has since addressed them, the analysts wrote. And while the stock is down 40% over the past 12 months due to compressed COVID vaccine sales, the analyst team expects those sales to hit a low in 2024 before rising again in 2025, amid increased education and spending on awareness of the need. for reinforcements.
Moderna's operating expenses are likely to decline significantly in 2024 and 2025, before recovering again after that, the analysts wrote. They estimate that the company will continue to generate losses until 2026, while the Bloomberg consensus is that the losses will extend until 2027.
"We should note that MRNA has indicated that if sales progression stabilizes or stagnates, the company will adjust OPEX accordingly," the note said.
Analysts assigned the stock a 12- to 18-month price target of $142, equivalent to an upside of more than 30% from its current price.
Watch now: Moderna reorganizes to focus on vaccine sales and chief commercial officer is leaving the company
Moderna's gains sent shares of other vaccine and drug makers higher. Bristol-Myers Squibb Co. (BMY) rose 4%, Pfizer Inc. (PFE) rose 3.9% and Merck & Co. (MRK) rose 2.9%.
- Ciara Linnane
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01-03-24 0801 ET
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