I Think Novavax Is Still A Buy...Even After A 1000%+ Return
Novavax, Inc., together with its subsidiary, Novavax AB, a late-stage biotechnology company, focuses on the discovery, development, and commercialization of vaccines to prevent serious infectious diseases.
About two years ago, a Novavax was about to get delisting by the NASDAQ. The company was just coming off of an event of a second failed vaccine trial in less than 3 years. On the news the stock price fell to under $1. So the company did what any company would to survive, it started shedding cost. The company sold its two Maryland manufacturing facilities and cut headcount by more than 100 employees. By January of this year, it employed just 166 people.
But then COVID made it’s presence known. Novavax receive billions in funding from the U.S. government and a nonprofit organization to develop and manufacture a coronavirus vaccine. It hired more than 300 employees to help with the mission to develop a COVID vaccine.
In February, Novavax begain development on it COVID-19 vaccine.
In May, Novavax wins close to $400 million from the Coalition for Epidemic Preparedness.
In June, the US Dept of Defense gives $60 million to Novavax to manufacture their COVID-19 vaccine.
In August, Novavax announces positive data from a phase I and II trial for their COVID-19 vaccine.
In September, Novavax launches their phase III trial in the UK.
In October, Novavax’ stock price hits $80.
The company anticipates reporting interim results from that U.K. study in early 2021. Novavax also hopes to begin its delayed U.S. late-stage study of the experimental vaccine within the next few weeks.
Assuming all goes well, Novavax could win emergency use authorizations (EUA) and approvals for NVX-CoV2373 in multiple countries in the first half of next year. Bernstein's Gal projects the biotech should rack up sales of $3.8 billion from its COVID vaccine.
Novavax (NASDAQ:NVAX) has jumped from a price of $4 a share back in January to $128 a share in December. That's a huge 3,000% gain for early investors. Is now a good time to buy Novavax?
Right now, the stock price is at the mercy of the company's COVID-19 vaccine. If Novavax reports 90% efficacy levels, the sky's the limit. At an $8 billion market cap, the stock could easily triple to $24 billion (still under the market cap of BioNTech). And some bulls might wonder why Novavax isn't as valuable as Moderna ($62 billion).
Novavax has agreements in place to manufacture over 2 billion doses. At a price point of $16 a dose, that's $32 billion in potential revenue in 2021. The upside is incredible. And we still don't know if a COVID-19 vaccine will be a one-time event (like for the mumps) or an annual ritual (like with the flu shot).
The company is also planning a combined flu/COVID-19 vaccine. Makes sense because the company has developed flu vaccine called NanoFlu. Although Novavax lags all the other major players with regards to having a commercial COVID-19 vaccine, this combined flu/COVID-19 vaccine could propel Novavax ahead of the other companies. Ideally the best level to buy is sub $100, but potentially price heads higher, before it heads lower.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
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I think the stock price of the company might reduce in the future as the outbreak of Covid seems to be why they are still striving.
I feel once the virus is down to a depleted level, the stock prices might crash. But to prevent this and sustain their stock prices, they should work on other groundbreaking drugs
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Flu happens every year, covid is similar to the flu, covid might be with us forever, we shall see, but I hear ya.
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Yeah. But none as been as serious as the one we are experiencing now
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