Moderna stock tumbled Thursday after the Covid vaccine maker handily beat third-quarter sales forecasts, but reported bigger-than-expected losses and issued light guidance for this year and next.
For the year, Moderna reiterated its guidance for at least $6 billion in sales — below expectations for $6.87 billion, according to FactSet. The company also expects about $4 billion in sales next year, hitting a trough before returning to growth in 2025. Analysts expected $6.05 billion in sales for 2024.
Citeline analyst Jeff Stevens says Moderna will have to score some key winds in 2024 and 2025 to bounce back from this expected sales dive.
"Moderna continues to shrink its growth expectations," he told Investor's Business Daily said in an email. "The dip is driven primarily by weak Covid-19 vaccine sales, and now anticipates 2023 yearly sales in the $6 billion range on the expectation that at least 50 million vaccines will be administered in the United States."
On today's stock market, Moderna stock toppled 6.5% to close at 71.23.
Moderna Stock: Sales Beat, But Losses Cut Deep
Despite the guidance disappointment, Moderna handily beat Wall Street's third-quarter sales forecast. Revenue tumbled 44% to $1.8 billion, but trounced expectations for $1.38 billion. Third Bridge analyst Lee Brown says the "post-pandemic hangover has yet to fully annualize."
The sales beat comes as Moderna expands its share of the Covid vaccine market. So far into the launch of the new booster shot — which blocks the XBB.1.5 subvariant of omicron — Moderna has 45% share, Chief Financial Officer Jamey Mock told Investor's Business Daily. That's up from 36% last year.
Fall vaccination rates are tracking in line with 2022 numbers, he said. Over time, Moderna expects to deliver 100 million to 150 million doses in the U.S. each season.
Moderna is competing against Pfizer and BioNTech, which have another messenger RNA-based shot, and Novavax's protein-based vaccine. All three are facing questions of demand, however. In the third quarter, Pfizer's sales tumbled 41% on an operational basis. Excluding its Covid products, however, Pfizer's sales climbed 10%.
Like Pfizer, Moderna also reported third-quarter losses. Losses came out to $9.53 per share, swinging from a year-earlier gain of $2.53. Analysts predicted a per-share loss of $1.93. Mock says the company notched $1.4 billion and $1.7 billion charges in the quarter related to re-sizing manufacturing capacity and footprint, and the company's tax position.
"But it doesn't affect our filings and we remain quite confident in our pipeline," he said.
Moderna, A New Company In 2025?
Now, Moderna is trying to rewrite its story.
"2024, we believe, will be a trough year," Mock said. "We think that is the low point in sales and we will grow thereafter. What will help us grow is that we will launch 15 products by 2028 and five products by 2025."
The company is currently looking ahead to 2024 when it could launch a vaccine to block respiratory syncytial virus, or RSV, in older adults. The virus typically causes coldlike symptoms. But it can be serious or deadly in newborns and older adults. If approved, Moderna's RSV shot would be its second product to hit the market, joining newly launched vaccines from Pfizer and GSK.
Mock says Moderna's shot will have an advantage over rivals. It's coming in a pre-filled syringe, cutting down on the steps overworked pharmacists have to take to administer it. But Moderna stock analyst, Brown of Third Bridge, believes the opposite. Coming from behind puts Moderna at a disadvantage.
"However, our experts also believe that Moderna's mRNA platform provides the company with significant advantages and expect a future combo RSV/flu vaccine will be able to propel Moderna into a leadership position, despite what is expected to be an increasingly crowed RSV competitive landscape," he said.
Late-Stage Pipeline In Testing
Beyond 2024, Moderna has six drugs in late-stage testing.
"To bounce back from a dip in 2024, Moderna will look to garner large victories amongst its late-stage pipeline," Citeline's Stevens said.
The company has six late-stage drugs in testing. Beyond RSV, it's also working on vaccines for influenza and cytomegalovirus, or CMV, a latent disease that lays dormant in the body and reactivates later.
Moderna is also working on cancer treatments in partnership with Merck. The duo is testing a personalized cancer vaccine in combination with Keytruda for patients who've had their melanoma surgically removed. But it will be years before that Phase 3 study has final results. They also plan to soon begin a final-phase study of the regimen in patients with a common form of lung cancer.
"Come 2025, we should be kicking in a flu product, our combination (flu and Covid) vaccine as well," Mock said. "So, that will help us grow in 2025 and beyond 2026 and 2027 as well."
But Moderna stock remains below its key moving averages, according to MarketSmith.com.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
