SVB downgrades Moderna to Underperform as COVID boom reverses

SVB Securities analyst Mani Foroohar downgraded Moderna (MRNA) to Underperform from Market Perform with a price target of $93, down from $111. The company’s fiscal 2022 results and updated 2023 guidance gave a deeper look into long-term margins as the pandemic revenue boom comes to an end, the analyst tells investors in a research note. The firm expects margin erosion unseen in the sector since the collapse of the hepatitis C virus market. It also sees potential additional royalties from the National Institutes of Health to Arbutus Biopharma (ABUS) and Alnylam (ALNY) as further downside risk to Moderna, depending on litigation outcomes. SVB thinks these changes point to an extended period of underperformance for the shares as the operating leverage that made the company one of the greatest pandemic beneficiaries reverses.