Moderna stock crashed Monday after the Covid vaccine maker slashed its outlook for 2024 and 2025 sales and announced an expanded cost-cutting initiative.
The company now projects $3 billion to $3.1 billion in sales of its two products, below its previous call for $3 billion to $3.5 billion. Moderna sells Spikevax, a Covid vaccine, and a vaccine to prevent RSV, or respiratory syncytial virus, in older adults. That shot is called mResvia.
Moderna also cut its 2025 outlook and now projects just $1.5 billion to $2.5 billion, well below its prior view for $2.5 billion to $3.5 billion.
Moderna stock crashed 16.8%, closing at 35.15.
Further, an independent data and safety monitoring board said Moderna's experimental CMV shot didn't show early effectiveness in a Phase 3 study. The decision means Moderna will need to continue testing the vaccine. If successful, the shot would protect against cytomegalovirus, which is related to the viruses that cause chickenpox, herpes and mononucleosis.
"While the third quarter represented an encouraging start to the company's redesigned path on the cost-cutting side, today's updates seemingly cloud the trajectory," William Blair analyst Myles Minter said in a report. "We continue to view Moderna as a show-me story."
'Tough Update' For Moderna
RBC Capital Markets analyst Luca Issi called it a "tough update" for Moderna.
But the rest of Moderna's pipeline updates were on track, he said in a report. The company expects to the Food and Drug Administration to make an approval decision on its next-generation Covid vaccine in late May. Further, Moderna is working to expand its RSV vaccine to younger patients, and expects to have pivotal test data from its norovirus vaccine sometime this year.
"Overall, we do remain believers in cancer vaccine and what the broader platform can do long term, but with multiple short-term headwinds (including Covid yet to find a floor and RSV struggling to get off the ground), we remain sector perform," he said.
Issi cut his price target on Moderna stock to 40 from 50.
Leerink Partners analyst Mani Foroohar reiterated his underperform rating on Moderna shares. He was not surprised to see shares down markedly given the "headwinds to growth prospects in 2025." In short, there is "no inflection in sight."
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