Why Moderna Stock Is Up By 6% Today

Moderna Stock Rallies To New Highs Amid Concerns About Delta Variant Of Coronavirus

Shares of Moderna have set a new record as traders rushed to buy the company’s shares amid concerns about Delta variant of coronavirus.

The Delta variant has spread from India to many countries in the world, and some countries have already been forced to introduce new virus containment measures.

Delta is more infectious than the original strain of coronavirus, and even countries which had successful mass vaccination programs, like UK, have to deal with an increasing number of new COVID-19 cases.

It looks that people need to have a higher level of antibodies to protect themselves against Delta compared to the original strain, but the situation develops fast and any data on this matter is preliminary.

Investors have been previously concerned about future revenues of vaccine producers, but it looks that the world may need coronavirus vaccines for years to come which is bullish for Moderna.

What’s Next For Moderna Stock?

Analysts expect that Moderna will report earnings of $24.57 per share this year and earnings of $18.2 per share in the next year, so the stock is trading at 13 forward P/E.

It should be noted that analyst estimates have been trending lower in recent weeks, but problems with the Delta variant of coronavirus may push estimates for 2022 to higher levels.

The situation with coronavirus remains highly volatile and it is difficlut to make accurate predictions about the spread of the virus and the demand for vaccines. However, Moderna’s current valuation looks conservative even if we account for uncertainty, so the stock has decent chances to continue its upside move.

I’d also note that shares of vaccine makers may face an influx of money from traders who are searching to hedge their bullish bets on the general market since vaccine stocks will likely get an additional boost in case the situation with COVID-19 gets worse.

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