Moderna, Inc. MRNA shares have rallied since the start of July, rendering the valuation unattractive and "ridiculous," according to a BofA Securities analyst.
The Moderna Analyst: Geoff Meacham maintained an Underperform rating on Moderna with a $115 price target.
The Moderna Thesis: At a roughly $200-billion market value, Moderna has eclipsed pharma industry veterans Merck & Co., Inc. MRK, Bristol-Myers Squibb Company BMY and Amgen, Inc. AMGN, Meacham said in a Tuesday note.
The latter three companies, the analyst said, are therapeutics businesses with proven long-term track records and deep/ diversified late-stage pipelines.
To justify Moderna's $200-billion valuation, the company needs to sell 1.5 billion doses of COVID-19 vaccine each year from 2022 through 2038, and its entire pipeline must succeed with aggregate peak sales of $30 billion, Meacham said.
"These assumptions are, in our view, impossible to justify," the analyst said.
A $485 fair value for the share would require cumulative COVID-19 vaccine sales of $340 billion through 2038, contributing $280 per share, and a pipeline value of $170 per share, which represents a 100% success rate for four Phase 2 programs, 10 Phase 1 programs and 8 preclinical programs, he said.
Feedback from infectious disease experts, Meacham said, provides support for a skeptical longer-term view of COVID-19 vaccines, even with the emergence of variants like delta.
MRNA Price Action: At last check, Moderna shares were down 5.69% to $456.88.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.
All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.
Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.
Rate collection and criteria: Click here for more information on rate collection and criteria.