Pharmaceutical and biotechnology company, which is focused on preparing messenger RNA (mRNA) vaccines, Moderna, Inc. (MRNA) recently announced that it has entered into a revised supply agreement with the UK government for the delivery of additional COVID-19 vaccine doses.
Terms of the Agreement
Under the terms of the agreement, Moderna will deliver up to 60 million doses of its COVID-19 vaccine (29 million doses expected to be delivered in 2022 and up to 31 million doses expected to be delivered in 2023). The delivered vaccines may also include booster doses.
The agreement allows the UK Government to retain a right to increase its purchases in 2022 and 2023 by up to 20% above the contracted volumes, or to decrease by the same amount.
Management Commentary
The CEO of Moderna, Stéphane Bancel, said, “We thank the UK government for their support in this supply agreement for our mRNA COVID-19 vaccine and booster candidates, if approved, in 2022 and 2023. This agreement reflects the efforts of the UK government to address the ongoing pandemic and builds on our existing collaboration to protect people in the UK.”
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Price Target
Recently, Jefferies analyst Michael Yee reiterated a Hold rating on the stock with a price target of $325, which implies upside potential of 4.6% from current levels.
The analyst said, “Current booster will likely be effective but of course a new version for 2022 including Delta and/or Omicron can be even better and is a reasonable update (like a software update). Ability to improve is nice and better for people – and business models (MRNA) but doesn’t change our view vaccines can control the pandemic.”
Consensus among analysts is a Hold based on 6 Buys, 4 Holds and 3 Sells. The average Moderna price target of $298.17 implies downside potential of 4% from current levels.
Smart Score
Moderna scores a 7 out of 10 from TipRanks’ Smart Score rating system, indicating that the stock is likely to perform in line with market expectations. Shares have gained 117.2% over the past year.
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