Moderna (NASDAQ:MRNA) broke out in July, bouncing from the $230 moving average to close at above $413 last week. Investors who missed the over six-fold return from 52-week lows are not too late.
Moderna stock is still not richly valued at a 23 times forward price-to-earnings ratio. The COVID-19 variants are proving difficult for the world to eradicate. Furthermore, people need booster shots around six months after full vaccination. Instead of annual vaccines, the revenue potential is 50% higher than previously thought.
Moderna also has a rich pipeline of vaccines against other diseases like cytomegalovirus. Furthermore, cancer therapeutics is an even bigger market. Now that the protection against COVID validated the mRNA model, Moderna has a bigger addressable market.
In the second quarter, Moderna posted a final blinded analysis showing 93% efficacy against COVID-19. Revenue was $4.4 billion while net income of $2.8 billion and diluted EPS was $6.46.
Moderna will start the Phase 3 study of CMV this year. It also started dosing for Phase ½ of the quadrivalent seasonal flu vaccine. And the Phase 2 study of the Zika virus began dosing. The discontinued development for Moderna’s oncology study (oX40L) is unfortunate. Overall, the 23 mRNA development programs will lead to continued revenue growth.
Investors should hold MRNA stock.
