Shares of Moderna experienced a significant surge of more than 15% on Tuesday following an upgrade by Oppenheimer, which now rates the stock as “outperform.” The upgrade is based on the belief that the Covid vaccine producer has the potential to market as many as five different products by 2026. This positive development comes after a challenging 2023 for Moderna, during which its only commercially available product was its Covid shot. With the company’s stock closely tied to the success of its vaccine, Moderna faced a 45% drop in share prices as demand for Covid products plummeted worldwide. However, Oppenheimer analyst Hartaj Singh believes that the future holds promising opportunities for the company.
Singh projects that Moderna’s Covid vaccine sales could hit a low point in 2024 due to factors such as vaccine fatigue. However, the firm anticipates a rebound in vaccine sales in 2025 and beyond as education about Covid increases and spending on disease awareness rises. Singh is particularly positive about Moderna’s pipeline potential and highlights several potential product launches in the next 12 to 18 months that could boost sales in 2025. One such product is an experimental vaccine designed to protect older adults from respiratory syncytial virus (RSV), which is known to cause mild, cold-like symptoms, but can be more severe in seniors and children. Moderna expects a decision from the Food and Drug Administration on its RSV vaccine in April of this year.
Another promising possibility highlighted by Singh is the potential approval of Moderna’s experimental flu vaccine in either 2024 or 2025. In a late-stage trial, the company’s flu shot produced a stronger immune response against four strains of the virus compared to currently available flu vaccines. Singh also mentions the potential filing for FDA approval of an experimental personalized cancer vaccine by Moderna in 2024 or 2025. If approved, Moderna may utilize the FDA’s accelerated approval pathway, which expedites approval for drugs that treat serious conditions and meet specific clinical trial metrics. Moderna is currently studying this cancer vaccine in combination with Merck’s Keytruda for the treatment of melanoma and other cancers.
Moderna expressed its confidence in future sales growth in a shareholder letter, particularly highlighting the RSV vaccine and the potential approval of its combination shot targeting both Covid and the flu, which could come as early as 2025. The company anticipates a decline in revenue to $4 billion in 2024 but expects growth to resume in 2025. Moderna aims to break even by 2026. In November, the company expressed that it would likely fall on the lower end of its sales forecast range of $6 to $8 billion for 2023, as demand for Covid vaccines weakened. Additionally, Moderna plans to launch up to 15 new products within the next five years.
The recent optimistic upgrade by Oppenheimer has sparked a significant surge in Moderna’s stock. With the potential for multiple product launches and the anticipation of a rebound in vaccine sales, the future appears promising for Moderna. As the world continues to battle Covid and invests in disease awareness, Moderna may find success in its pipeline and achieve its long-term goals. Investors and industry experts will be closely monitoring the company’s progress over the coming years.
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