Why Moderna Stock Is Up By 7% Today?

Moderna Video 16.03.21.

Moderna Shares Move Higher As Company Starts Trial Of COVID-19 Vaccine In Children

Moderna shares gained strong upside momentum and are gaining 7% in today’s trading session after the company stated that it began to test its coronavirus vaccine in children. The study will include children aged from 6 months to 12 years.

Yesterday, the company stated that it had initiated a trial of its next COVID-19 vaccine candidate which should be stable in refrigerators. This is important because less developed countries do not have the resources to store vaccines at very low temperatures. If a vaccine is stable in refrigerators, it will be able to gain additional market share.

In addition to positive internal news, Moderna stock is supported by the current troubles of AstraZeneca‘s vaccine. Germany, France, Italy and several other European countries suspended the use of AstraZeneca’s vaccine amid concerns that the vaccine can provoke serious side effects in rare cases.

The World Health Organization promised to issue a statement on the topic by the end of the day, but it is clear that the political decision to stop inoculations in many European countries has already been made. This situation presents an opportunity for other vaccine providers to gain market share.

What’s Next For Moderna?

Moderna shares have pulled back from recent highs near the $190 level but managed to find support near $120 and are currently trying to settle above $150. The stock remains very volatile which is not surprising for shares of a biotechnology company that produces one of the world’s leading vaccines against coronavirus.

The key question for the valuation of all COVID-19 vaccine makers is whether the revenue from vaccines will be recurring in case the population will have to take the vaccine periodically, for example, every year.

Analysts are optimistic about the company’s financial performance and expect that Moderna will earn $21.96 per share in 2021 and $14.93 per share in 2022. At current prices, the stock is trading at about 10 forward P/E for 2022 which is cheap, but analyst estimates vary widely, highlighting uncertainty regarding the company’s future performance.

That said, AstraZeneca’s problems in combination with Moderna’s internal positive catalysts may provide additional upside for the company’s shares despite high uncertainty about its future profits.

For a look at all of today’s economic events, check out our economic calendar.