One stock that has been on an upward trajectory since the outbreak of the COVID-19 pandemic is Moderna Inc MRNA, a clinical-stage mRNA company.
The Cambridge, Massachusetts-based company first announced a collaboration with the National Institute of Allergy and Infectious Diseases to develop a COVID-19 vaccine on Jan. 23, and since then the stock has more than doubled.
Moderna shares were relatively immune to the broader market pullback that occurred through most of March. After hitting a near-term low of $31.32 April 9, the stock witnessed strong upward momentum and is currently trading off its 52-week highs.
The week has been especially kind to the stock, with a couple of catalysts pushing it sharply higher. Moderna has gained in all four sessions and is poised to sustain the momentum in Friday's session.
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Booster Shot From Moderna's Vaccines Day, Funding Update
After closing at $31.86 April 9, the stock ended Monday's session up 3.3% at $32.90. It added an incremental 5.4% Tuesday before ending at $34.66, catalyzed by the Virtual Vaccines Day hosted by the company.
The enrollment of participants for the highest dose arm is underway in the Phase 1 study of mRNA-1273, its vaccine candidate for the new coronavirus, SARS-CoV-2, according to Moderna.
The company also issued an update on the rest of its pipeline, including its Zika vaccine candidate, mRNA-1893, which is being evaluated in a Phase 1 study.
Positive sell-side actions, including price target revisions, helped the company gain an incremental 7.5% Wednesday to $37.25. The stock took off yet again Thursday as the positive momentum carried into the session. Moderna ended Thursday's session about 9% higher at $40.60.
Stoking the rally in play for the week, the company announced late Thursday that the Biomedical Advanced Research and Development Authority has agreed on a funding commitment for up to $483 million to move the vaccine candidate expeditiously toward FDA licensing.
The company already has a funding commitment from the Coalition for Epidemic Preparedness Innovations for the manufacturing of the vaccine candidate.
Moderna also provided a likely timeline for the initiation of Phase 2 and 3 studies, with the midstage study scheduled to start in the second quarter and the late-stage study in fall 2020.
Is The Moderna Rally Sustainable?
The enthusiasm on the sell side doesn't measure up to the market.
Needham analyst Alan Carr said in a Friday note that he has not included the COVID-19 vaccine program in his valuation for the company given the uncertainties around the pandemic and minimal room for pricing in the current political environment.
The analyst is positive about the company's platform and the rest of its pipeline.
"We continue to believe the mRNA platform is a source of long-term value and that the stock is attractive for long-term investors," he said.
Carr has a Buy rating on Moderna shares and $35 price target.
Chardan analyst Geulah Livshits sees the timeline provided by the company as prudent.
"We see a high likelihood of the phase II trial moving forward based on the relatively clean safety profile seen with Moderna's other vaccine programs (with the addition of elderly cohorts providing a further signal here," the analyst said.
Chardan has a Buy rating and $40 price target for the shares.
MRNA Price Action
Moderna shares were trading 15.62% higher at $46.94 at the time of publication Friday.
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