Novavax executives have seized the opportunity to bank profits and capitalize on the 3,000% rally in the stock’s share price as speculators continue to bet on the success of the COVID-19 vaccine that is still under trial, Reuters reports. Shares dropped almost 3% in US trading.
Novavax (NVAX) was only worth around $250 million a year ago, according to Reuters, but since receiving $1.6 billion in funding under the “Operation Warp Speed” program, it has become a global player in the race to develop a COVID-19 vaccine, and has seen its valuation spike by as much as $11 billion.
Novavax’s COVID-19 vaccine has shown promising results in its preliminary trials and has signed supply deals with Japan, Canada, Australia, the UK and the US.
According to a review of SEC filings, Novavax CEO, Stanley Erck, sold $8.7 million worth of his shares in 2020, which amounts to more than 20% of his vested stake in the company, Reuters reported. In addition, other Novavax executives sold another $37.3 million worth of shares during 2020.
Sanjai Bhagat, a finance professor at the University of Colorado told Reuters that members of the board should have insisted that the executives hold onto their shares, as it would have incentivized the company’s leaders to ensure the successful and speedy roll out of the vaccines. (See NVAX stock analysis on TipRanks)
B.Riley Financial analyst Mayank Mamtani recently reiterated his Buy rating on NVAX setting a price target of $223. This implies upside potential of around 91% from current levels.
Mamtani was optimistic about the interim results of the U.S vaccine study and believes that Novovax could have a big role to play in the distribution of COVID-19 vaccines
Consensus on the Street is a Moderate Buy based on 5 Buys and 1 Sell. The average price target of $183.20 suggests upside potential of around 57% over the next 12 months.