Moderna Stock Crash Has Wiped Nearly $100 Billion As Flu Vaccine Results Trigger Latest Plunge

Topline

Moderna shares plummeted Friday morning after the Cambridge, Massachusetts-based biotech firm reported early data for its seasonal flu vaccine that failed to impress investors, intensifying a crash that’s wiped out nearly 50% of the value in one of the year’s best-performing stocks.

Key Facts

Shares of Moderna fell 8% Friday by 11:30 a.m. ET after the company reported early data for its seasonal flu vaccine that showed robust increases in antibody concentration among patients in the study. 

Though Moderna touted the results as positive, Morgan Stanley analyst Matthew Harison said the initial data looked “undifferentiated” with biotech firm Sanofi’s flu vaccine, which is already on the market—a disappointment for investors seeking data that “supported clearly better efficacy.”

Shares plunged as much as 13% after the early morning report, pulling prices to near one-month lows until they pared losses after Moderna announced a new agreement to supply 20 million more Covid-19 vaccine doses to the World Health Organization’s Covax initiative, which is now on track to receive about 54 million Moderna vaccine doses in 2021.

At current prices of about $250, shares of Moderna have plunged 48% from an all-time closing high of $484 on August 9, wiping out about $97 billion from the firm’s market capitalization, which now stands at roughly $101 billion.

Despite its recent weakness, Moderna is still the S&P’s third-best-performing component this year, with shares skyrocketing about 127% thanks to the company’s Covid-19 vaccine becoming widely available across the world.

Big Number

$8 billion. That’s how much Moderna CEO Stéphane Bancel, who joined the firm in 2011, is worth as of 11:30 a.m. Friday, according to Forbes. The French native owns a roughly 8% stake in Moderna.

Key Background

Covid-19 vaccines, which are Moderna’s only commercialized product, have proven to be a massive boon for businesses heading up their development, but Moderna shares have struggled in recent months as critics increasingly question whether or not sales of Covid-19 vaccines alone will prove a viable revenue stream in years to come. Last month, the company reported third-quarter sales and earnings that failed to meet analysts’ expectations, with revenue falling short of $5 billion despite average analyst projections calling for $6.2 billion. In addition to lower sales projections, supply chain constraints and the development of antiviral Covid-19 treatments have also triggered Moderna stock sell-offs. 

Tangent

Diverse product offerings have helped Moderna’s biggest Covid-19 vaccine competitors earn high marks on Wall Street. Wells Fargo recently initiated Pfizer coverage with a “buy” rating and $60 price target, implying an upside of around 16% from current levels. The vaccine-maker’s new oral antiviral pill, Paxlovid, “provides another avenue for Covid-related growth” and will be a “game changer” for the company’s profits, the analysts said, forecasting nearly $18 billion in sales from the product next year. 

Further Reading

This Vaccine Maker Can ‘Dominate’ The Covid Market For Years To Come, Wells Fargo Predicts (Forbes)

Moderna Crash Wipes Out Another $24 Billion After Supply-Chain Issues Dent Covid Vaccine Sales (Forbes)

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