Why Moderna Stock Is Down By 5% Today

Improved Guidance Failed To Provide Sustainable Support To Moderna Stock

Shares of Moderna gained downside momentum today as traders took some profits off the table after yesterday’s rally.

Moderna has recently reported that it expected to record revenue of $18.5 billion from existing contracts for the delivery of COVID-19 vaccine in 2022. The company may also gain approximately $3.5 billion in revenue in case all options are exercised.

For the full year 2021, the company plans to report sales of $17.5 billion. In addition to the production and development of the coronavirus vaccine, Moderna has 40 programs in development, including 23 programs in ongoing clinical studies.

In its press release, Moderna highlighted its non-coronavirus vaccines and therapeutics, which will be vital for the company’s success when the coronavirus pandemic ends. However, it remains to be seen whether the market is ready to take a look at the post-coronavirus potential of Moderna at a time when the world faces a significant wave of Omicron.

What’s Next For Moderna Stock?

Analysts expect that Moderna will report earnings of $27.85 in 2022, so the stock is trading at roughly 8 forward P/E, which is certainly cheap for the current market environment.

However, the market remains skeptical about Moderna’s ability to maintain its revenue in 2023 and beyond. Other vaccine stocks like Novavax and BioNTech have also underperformed in recent weeks.

It remains to be seen whether Moderna will be able to raise revenue guidance for 2022, so that analysts can re-write their earnings forecasts. These forecasts have been improving in recent weeks, but this improvement failed to provide any support to Moderna stock.

At this point, it looks that Moderna stock needs a multiple expansion to have sustainable upside from current levels. However, it is not clear whether the market is ready to assign a higher price tag for the stock at a time when its 2023 revenues remain a mystery.

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