A healthcare worker prepares a dose of the Moderna COVID-19 vaccine

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Stock in the Covid-19 vaccine maker Moderna fell 16% Wednesday as investors seemed to struggle to value shares that have nearly tripled in value this year.

Moderna

(ticker: MRNA) shares had an unbelievable run from the beginning of the year through the middle of last week. The stock was up more than 300% over that period, beating the

S&P 500,

which climbed 18.%; the

iShares Biotechnology ETF

(IBB), which was up 14%; and the

SPDR S&P Biotech ETF

(XBI), which fell 11%.

No other stock in the S&P 500, which Moderna joined in late July, has performed nearly as well. The runner-up,

Bath & Body Works

(BBWI), was up 106%, a respectable gain that isn’t even close to being in Moderna’s league.

In April, Barron’s recommended buying Moderna shares, saying that worries that its market value was too high were overblown. When the article went to press, the company’s market value was $67 billion. On Aug. 4, the day before the company reported its latest earnings, its market value was $168.9 billion, according to FactSet.

That means that investors thought the company was worth more than the big pharma giant

Bristol Myers Squibb

(BMY), which has a market value of $149.7 billion. The value was nearly twice that of the biotech stalwart

Gilead Sciences

(GILD), at $86.8 billion.

But as Moderna unveiled its quarterly earnings on Thursday, analysts and investors seemed to look around and develop a case of vertigo. Two longtime Moderna bulls, Oppenheimer analyst Hartaj Singh and Piper Sandler analyst Edward Tenthoff, cut their ratings on the stock. Singh dropped his rating to Perform from Outperform, while Tenthoff cut his to Neutral from Overweight.

“With a ~$170B market-cap (largest biotech now) and up 300% YTD …MRNA shares are fairly pricing a tremendous amount of future recurring revenues and pipeline progress,” Singh wrote.

In the days since, the market has been struggling to find a stable price for Moderna shares. The stock jumped 17% on Monday, fell 5.7% on Tuesday, and fell again on Wednesday.

Bank of America analyst Geoff Meacham wrote in a note published Tuesday that the valuation remains “unreasonable.” In order to justify the market capitalization, an investor would need to assume that the company would sell up to 1. 5 billion doses of its Covid-19 vaccine each year, and “a 100% probability of success for the entire pipeline with aggregate peak sales of $30 billion,” he said.

Covid-19 vaccine news has, nevertheless, been positive for Moderna in recent days. Doctors at the Mayo Clinic on Sunday posted a preprint of a study that found that, in a real-world study conducted in Minnesota, the efficacy of the Moderna vaccine was superior to the one from

Pfizer

(PFE) while the Delta variant was dominant. Meanwhile, authorization of booster doses for at least some subset of the population seems increasingly likely, though Pfizer’s will be first in line.

Still, shares are dropping. In a note out Wednesday, BayCrest Partners managing director Jonathan Krinsky noted that trading volume has been high on Moderna shares in recent days.

“If it looks like a blowoff, and feels like a blowoff, it’s probably a blowoff,” he wrote. “There is likely further downside in the weeks ahead here.”

Write to Josh Nathan-Kazis at [email protected]

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