Why Moderna Stock Is Down By 18% Today

Moderna Stock Falls As The Company Cuts Its Full-Year Revenue Outlook

Shares of Moderna gained strong downside momentum after the company released its third-quarter report. Moderna reported revenue of $5 billion and earnings of $7.70 per share, missing analyst estimates on both earnings and revenue.

The company stated that it expected product sales of $15 billion – $18 billion in 2021 compared to the previous estimate of $20 billion. Moderna expects that deliveries of its coronavirus vaccine would total 700 million – 800 million doses compared to the previous expectation of 800 million – 1 billion doses.

Moderna has also announced that its Board of Directors has authorized a share repurchase program of up to $1 billion over a two-year period. According to Moderna, no shares have been bought back through the end of the third quarter.

For 2022, the company has already signed $17 billion of advance purchase agreements. It also anticipates the exercise of options of up to $3 billion and plans that U.S. booster market sales could be up to $2 billion. Thus, Moderna estimates that its 2022 revenue would total $17 billion – $22 billion.

What’s Next For Moderna Stock?

Moderna stock has pulled back from the highs near the $500 level towards $285, but it remains to be seen whether speculative traders and investors will rush to buy the stock.

The company has just cut its guidance for 2021, and the guidance for 2022 does not promise significant growth. Moderna will start to repurchase its shares, but the size of the buyback program is not material compared to the current market capitalization.

Currently, analysts expect that Moderna will report earnings of $26.71 per share in 2022, so the stock is trading at roughly 11 forward P/E. While such valuation levels look cheap in today’s market environment, there is little earnings visibility beyond 2022, and it looks that the stock will need additional positive catalysts to break the current downside trend.

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