If you’re looking for information about Moderna stock, you’ve come to the right place. In this blog post, we’ll provide an overview of Moderna and its operations, as well as give our opinion on whether it’s a good investment or not.
We’ll also discuss some of the news surrounding Moderna in recent years. So, if you’re interested in learning more about this company, keep reading!
Overview of Moderna
Moderna is a biotechnology company founded in Cambridge, Massachusetts, in 2010. It focuses on developing messenger RNA (mRNA) therapeutics designed to treat diseases by modifying DNA instructions for cells to create disease-targeting proteins. The ability to use regular human biology to target diseases means mRNA has the potential to treat a wide range of conditions. This fact excites us about Moderna’s pipeline of clinical trials. The company has seen significant growth over the last few years and is now worth an estimated $65 billion.
Despite being one of the pioneers of mRNA technology, Moderna entered the public lexicon due to the FDA’s emergency use authorization and a rapid rollout of its Covid-19 vaccine. It is the company’s sole revenue-generating product, with a clinically proven efficacy of 94% at preventing COVID-19 in people with two doses.
Moderna Fundamentals
Moderna stock went public in 2018 and hovered between $15 to $20 till it took off in 2020. When writing this article on January 30, 2022, here are the fundamentals you should pay attention to for Moderna from Yahoo Finance.
Market Capitalization: $64.657B
Market capitalization measures the company’s worth based on the number of issued shares at the current market share price. Moderna is a multi-billion dollar company based on its market cap valuation.
PE Ratio: 8.9
The Price to Earnings (PE) ratio is calculated by dividing the current share price by the earnings per share (EPS). This ratio is a measure of how expensive a company’s stock is when compared to other companies. You must compare PE ratios within the same industry to understand whether the company stock will generate a good return as part of your portfolio. For example, compare Moderna’s PE ratio of 8.9 to Pfizer’s (16.19) or Gilead’s (11.79).
EPS: $16.69
Earnings per share (EPS) is calculated by dividing a company’s net profit by the number of shares outstanding. This number identifies the company’s income earned per share. A ‘good’ EPS is hard to define but depends on the growth rate over the last few quarters and performance versus other competitors in the industry. Another way to look at the EPS would be to see how much the market is willing to pay for each dollar of income.
52-week Stock Price Range: $117.34 – $497.49
This range gives you an idea of how volatile a stock is and the recent price trend. In the last year, Moderna has been as low as $117 and has almost reached $500. This type of volatility is high for any company and should be analyzed further to determine if valid factors justify the stock price changes.
How Has Moderna Stock Performed Lately?
Moderna stock {ticker: MRNA} took off on a ride to the moon over the last couple of years, hitting a high of $484 in August of 2021. It was one of 2021’s best-performing stocks.
At the time of writing this article, Moderna stock has followed the rest of the market into red territory, trading at just over $159 at the close of markets on January 28, 2022.
Overall, more than 60% of the company’s value has been wiped out in 2022, with more than a 20% drop registered in just one week.
Why Did Moderna’s Stock Price Drop?
There are a few reasons why the market lost confidence in MRNA stock.
- Recent research papers have suggested that Moderna’s Covid-19 vaccine was ineffective at preventing infections caused by Covid variants like Omicron.
- While the vaccine remains effective at preventing hospitalizations, the rate of Omicron infections has continued to grow in people already vaccinated with two doses.
- As Covid-19 starts to become endemic, there is concern about Moderna’s over-reliance on its Covid-19 vaccine as the top revenue earner for the company.
- Additionally, Moderna is heavily reliant on partnerships with larger pharmaceutical companies to fund its operations. If these relationships sour, it could hurt the company’s growth prospects.
At the same time, Moderna has several strengths.
What Are Moderna’s Strengths?
There are several strengths that Moderna brings to the table. Firstly, it has a powerful management team and a board of directors. CEO Stéphane Bancel, for example, is a veteran in the biotech industry and has been successful in growing other companies. The company also has a large pool of scientific expertise, which it draws on to develop new products.
Moderna’s biggest strength is its pipeline of trials based on disruptive mRNA technology, which it has spent decades developing. Compared to traditional vaccines, which rely on the current strain of the virus or pathogen to be introduced into the body to encourage antibody production, mRNA can be a substantial competitive advantage. It could prove to be a significant catalyst for the company in the coming years if clinical trials for its flu vaccine prove successful.
Moderna has also recently partnered with Carisma Therapeutics to develop treatments for several types of cancer. If successful, this could prove to be a blockbuster for Moderna stock in the future.
Should I Buy The Moderna Stock?
Stock picking, in general, is riskier than buying diversified exchange-traded funds (ETFs) or mutual funds. Before rushing to buy or sell any stock, it’s essential to do your research and analysis. Start with the fundamentals and understand the products and revenue streams that the company has. Is it a one-trick pony, or does it have a reliable stream of products and income to protect your investment?
Study the financial statements to review the past and projected net income. Consider subscribing to a stock advisor service to get expert opinions and detailed analysis of potential opportunities from well-known investors.
Next, look into the company’s potential by analyzing its management team and competitive advantages versus other similar companies. You may be better off buying a biotech-focused ETF that spreads out the risk over several high-performing companies in the industry.
In the case of Moderna, there are several other companies and stocks that you could consider. Here are some examples.
- Pfizer (PFE),
- Johnson & Johnson (JNJ),
- Sanofi (SNY),
- BioNTech (BNTX),
- Novavax (NVAX), and
- Gilead Sciences (GILD).
Moderna is a solid performer but still a risky buy because of its unproven lineup of products. To achieve a proper balance, spread your investments over a mix of growth-focused, high-risk stocks and mature, low-risk companies.
Before buying a stock like Moderna, study your portfolio and see if it is diversified enough to protect you in case of further market drops. Have you invested heavily in Biotechnology stocks already? If not, you may still want to consider buying a bouquet of biotechnology and other sector stocks within a low-cost stock Exchange Traded Fund (ETF). That way, you spread your risk and don’t rely on any market segment or industry to prop up your portfolio.
Final Thoughts
Overall, we believe that Moderna is a promising company with a lot of growth potential. It has a strong management team, a large pool of scientific expertise, and several valuable partnerships. While there are some risks associated with investing in early-stage companies, Moderna is well-positioned to succeed in the long run. If you’re interested in learning more about this stock, we recommend checking out its website or giving its investor relations team a call.
The stock market has been pretty volatile to kick-off 2022. Don’t let that discourage you from investing, though. As a general rule of thumb, keep a long-term mindset when constructing your investment portfolio and be sure to spread out your risk. Do not invest more than 5% of your savings into a single stock.
While this article is our opinion, it is always critical to do your research. Each person’s investment plan is unique, based on age, risk appetite, savings, goals, and investment horizon. What’s yours?
This post was produced and syndicated by Wealth of Geeks.
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