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Has COVID-19 Stock Moderna (MRNA) Come Too Far, Too Fast?

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April 21, 2020

An interesting subtext to these coronavirus driven times is the Battle of the Biotechs. The race for a vaccine or a treatment is justifiably generating a host of headlines as companies, big and small, vie to become the ones providing the much-needed solutions.

Moderna (MRNA) has been attracting its share of attention with a potential vaccine. Shares of the messenger RNA specialist have come very far, very fast over the past four months and change. At the start of 2020, this was a $19 stock. Today, Moderna stock trades hands at roughly $52 — more than double its early 2020 price. So, what is all the excitement about?

On Friday, Moderna announced it had been awarded $483 million from BARDA (the Biomedical Advanced Research and Development Authority) to further develop and accelerate the manufacturing of its coronavirus (SARS-CoV-2) vaccine candidate mRNA-1273, all the way through to a possible FDA license.

Additionally, an NIH Phase 1 study of mRNA-1273 has completed enrollment of 3 dose cohorts (25 µg, 100 µg and 250 µg) and was recently modified with the addition of six (3 older and 3 elderly) adults (currently enrolling). Following safety data from the Phase 1 trial, Moderna expects to move ahead with a Phase 2 study of mRNA-1273 later in the current quarter. Based on the totality of data and regulatory interactions, a Phase 3 study could begin in the fall.

Oppenheimer’s Hartaj Singh commented, “We believe this award and technical support of government agencies should enable the supply of millions of doses/month in 2020 and tens of millions/month in 2021 under the current time-sensitive development for a COVID-19 vaccine and should further facilitate regulatory discussions. We stay bullish.”

To this end, the 5-star analyst reiterated an Outperform on Moderna along with a $43 price target. Following the stock’s recent surge, though, the figure represents possible downside of 17%. (To watch Singh’s track record, click here)

Moderna currently has a Strong Buy consensus rating based on 8 Buys and 1 Hold. The average price target is $39.88, and implies the analysts foresee the stock tumbling by 14% in the year ahead. Either the analysts have yet to update their models, or the majority believe the stock has flown high enough for now. (See Moderna stock analysis on TipRanks)

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