Why Moderna Stock Is Down By 6% Today

Key Insights

• Vaccine stocks remain under pressure due to poor earnings visibility
• Moderna is set to release its earnings report on February 24
• The stock will need strong upside catalysts to change the current trend

Moderna Stock Falls As Traders Stay Bearish On Vaccine Stocks

Shares of Moderna gained downside momentum after the company announced a 15-year strategic collaboration agreement with Thermo Fisher Scientific, which will produce the company’s coronavirus vaccine and other mRNA medicines in the pipeline.

However, the announcement did not serve as a bearish catalyst for Moderna, and the stock moved lower due to general market pressure and expectations for the end of the pandemic. Other vaccine stocks like BioNTech and Novavax have also found themselves under pressure.

Interestingly, analyst estimates for Moderna’s 2022 earnings have been moving higher in recent weeks. Currently, analysts expect that Moderna will report earnings of $28.32 per share this year, so the stock is trading at just 5 forward P/E.

What’s Next For Moderna Stock?

Poor earnings visibility remains the key problem for Moderna. In the near term, the company’s financial results will be very strong, but the market questions the company’s ability to repeat this performance in 2023 and beyond.

In addition, Moderna is set to release its full-year 2021 report on February 24, so some traders prefer to cut their risks ahead of this event.

To have sustainable upside, Moderna must provide investors with a clear path to future profitability without the current reliance on the coronavirus vaccine. It remains to be seen whether this is realistic in the near term.

In case the market remains skeptical about Moderna’s future revenue, the stock will remain under pressure together with other vaccine stocks. The current market consensus implies that Omicron was the last significant variant of coronavirus, and the end of the pandemic is near. While this scenario is bullish for the world economy, it is bearish for Moderna.

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