Moderna stock jumped Thursday on an unexpected first-quarter gain even as sales plummeted amid waning demand for Covid vaccines.
During the first quarter, Moderna earned 19 cents per share. Earnings crashed 98% year over year. But Moderna shocked Wall Street when it turned a profit. Analysts had projected a per-share loss of $1.75. Sales also plunged 69% to $1.86 billion, but topped calls for $1.18 billion.
Third Bridge analyst Lee Brown says Moderna is well on the other side of its Covid peak. The company expects just $200 million to $300 million in second-quarter sales and $5 billion for the year based on currently signed agreements for its only approved product, the Covid vaccine called Spikevax.
"As our experts have repeatedly highlighted, Moderna's late-stage pipeline is paramount to the company's success as we have fully transitioned to a post-pandemic environment," Brown said in a note to clients.
On the stock market today, Moderna stock jumped 3.2% to close at 134.33. Shares have long traded beneath their 50-day and 200-day moving averages, according to MarketSmith.com.
What's Next For Moderna Stock?
The Covid vaccine generated most of Moderna's sales at $1.83 billion. The remaining $34 million came from grant and collaboration revenue.
Brown notes the top-line beat came mostly from deferred 2022 Spikevax deliveries.
But that's likely to be unsustainable. Moderna's projection for $5 billion in sales this year lagged analysts' calls for $7.73 billion, according to FactSet. Moderna says it's still negotiating for additional deliveries this year in key markets, including the U.S., Japan and European Union.
Beyond Covid, Moderna hopes to gain approval this year for a vaccine to prevent respiratory syncytial virus, or RSV, in older adults. On Wednesday, the Food and Drug Administration approved a shot from GSK. It's the first-ever to gain approval. Pfizer's could also win the FDA's blessing this month.
Brown estimates the annual RSV vaccine market could top $10 billion globally.
"But our experts point out that (Moderna) will now face an established competitor given yesterday's FDA approval of GSK's RSV vaccine, Arexvy," he said.
Six Major Launches Expected
Moderna also is preparing for six major vaccine launches from its respiratory franchise, including shots to block Covid, RSV, flu and combinations. Those could generate annual sales between $8 billion to $15 billion by 2027, Brown said.
Moderna stock investors also are watching the company's Merck-partnered cancer vaccine. In Phase 2 testing of patients with melanoma, a combination of the vaccine and Merck's Keytruda reduced the risk of relapse or death by 44% vs. Keytruda alone. It could "profoundly" change melanoma treatment, he said.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
