A Fresh Look at Moderna: Beyond the Bearish Sentiment
With its share price plummeting 75% in the last three years, it’s easy to dismiss Moderna (NASDAQ: MRNA) as a biotech that’s lost its mojo. However, where others see despair, savvy investors spot opportunity. Let’s dig into the three crucial factors to consider before investing in Moderna today.
Revenue Reality Check
A growing revenue base is essential for any compelling investment thesis. Unfortunately, Moderna’s trailing-12-month revenue has taken a nosedive, plummeting 77% to just over $5 billion. The demand for coronavirus vaccines has waned, and despite the recent approval of its RSV vaccine, sales have been underwhelming. Management expects revenue to dwindle further, with a projected maximum of $3.5 billion in 2024. It’s essential for shareholders to temper their expectations, as the stock may continue to decline in the near term.
A Glimmer of Hope on the Horizon
While the next three years may be rocky, Moderna’s future looks brighter beyond that. The company plans to launch around 10 new programs between now and 2028, including a combination jab for COVID and influenza, and a therapeutic vaccine for various cancers. These new products will help stabilize revenue and eventually drive growth. Additionally, Moderna is developing therapeutic vaccines for rare diseases, which, if approved, will demonstrate the company’s innovative capabilities and add value.
Government Ties and Growth Opportunities
A strong relationship with governments is vital for vaccine developers, as they are often the largest customers. Moderna’s recent $590 million grant from the U.S. government to develop its pandemic influenza vaccine program demonstrates its close ties. This partnership positions Moderna to be a preferred provider of vaccines in the event of a larger influenza outbreak, potentially unlocking significant growth opportunities. While there are no guarantees, management’s efforts to expose the business to various growth avenues bode well for the long-term outlook.
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