Moderna, Inc. (MRNA – Get Rating) sparked a big buzz in July with its COVID vaccine candidate, mRNA-1273. The company engages in the development of transformative medicines based on messenger ribonucleic acid (mRNA). MRNA is developing therapeutics and vaccines for infectious diseases, immuno-oncology, rare diseases, cardiovascular diseases, and autoimmune and inflammatory diseases, independently and with strategic collaborators.
MRNA is one of the best performing COVID vaccine-maker stocks so far this year with record revenue growth. In the second quarter ended June 2020, MRNA’s top-line increased 407%. It reported a loss of $0.31 per share, significantly improving from the year-ago loss of $0.41 per share. Research and development expenses were $151.9 million for the quarter compared to $128.3 million in the comparable period last year.
The vaccine candidate generated antibodies that neutralize the virus in each study participant during the phase 1 trials. Hence, despite growing competition in developing the first vaccine, the stock gained 243% year-to-date. However, the uncertainty related to the stock’s continued momentum based on a number of factors has made our proprietary rating system rate it as “Neutral.”
Here is how our proprietary POWR Ratings system evaluates MRNA:
Trade Grade: C
MRNA is currently trading near its 50-day moving average of $70.79, but higher than its 200-day moving average of $66.49, indicating that the stock is in an uptrend. The stock’s 123% return over the past six months reflects solid short-term bullishness.
MRNA has received approximately $400 million of customer deposits as of July 31, 2020, for the potential supply of its Covid-19 vaccine. Phase 3 study of the same has been initiated in July and is being conducted in collaboration with the National Institutes of Health (NIH) and Biomedical Advanced Research and Development Authority (BARDA). The company is on track to complete enrollment in September 2020.
Buy & Hold Grade: C
In terms of proximity to its 52-week high, which is a key factor that our Buy & Hold Grade takes into account, MRNA is not positioned well. The stock is currently trading 29.5% below its 52-week high of $95.21.
MRNA has had its share of skeptics since none of its drugs, and the technology which makes them possible has paid off in real life to date. But developing an effective COVID vaccine could reverse that narrative. The company has no approved products in its portfolio and has many products in its pipeline that are in phase 1 or 2 trials, or the preclinical testing stage.
The second quarter marked a new growth phase for MRNA as it has started to build its commercial team. The company stated that as of August 5, it had…
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