After various setbacks, Novavax (NVAX) finally managed to get its Covid-19 vaccine across the finish line this year. That has done little, however, to alter the stock’s fortunes. In fact, it currently sits just above its 52-week low, having shed 78% off its valuation on a year-to-date basis. That is partly down to a woeful Q2 financial statement, in which the vaccine maker missed both the revenue and earnings targets and slashed its full-year revenue guidance.
So, where to now for this once high-flying pandemic-era winner? With both Pfizer/BioNTech and Moderna recently providing the regulators both in the U.S. and the E.U. with EUA qualifying datasets for their new, Omicron adapted bivalent vaccines, B. Riley analyst Mayank Mamtani reminds investors that Novavax is breathing down their necks, on target to meet its own “regulatory milestones.”
The company has what Mamtani calls a “two-pronged strategy: (1) submission of original prototype vaccine (NVX-CoV2373) application for homologous and heterologous boosting on the basis of Ph. III PREVENT-19 (U.S.-focused) and Ph. II COV-BOOST (U.K.-focused) trials; and (2) advancing through the Ph. III BA.1 and BA.5 immunogenicity trial (NCT05372588) where a generally low bar is set by the mRNA vaccines, i.e., 1.5 and 2-fold higher nAb titers induced against Omicron than levels induced by a booster of the ancestral vaccine.“
As part of the upcoming fall booster campaign in developed countries, Novavax has set its sights on “minimizing the lag time to regulatory approvals and ensuing revenue recognition,” so as not to lose ground vs. the mRNAs crowd. Given the disastrous Q2 results, keeping up with the frontrunners will be essential for investors to “recognize a compelling value play” even if the stock’s current price already makes it one.
Investors might still need to be convinced, but confidence in Novavax is not something Mamtani lacks. The analyst’s rating stays a Buy, while his $126 price target suggests investors could be sitting on returns of 314% in a year’s time. (To watch Mamtani’s track record, click here)
Looking at the consensus breakdown, there’s one fully-fledged NVAX bear currently roaming Wall Street, but all 7 other recent analyst reviews are positive, making the consensus view here a Strong Buy. The upside is plentiful too; according to the $97.4 average target, there’s room for 220% growth in the months ahead. (See Novavax stock forecast on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
