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If you invested $ 10,000 in shares of a coronavirus vaccine maker Modern (NASDAQ: ARNM) last year, this capital would have increased to over $ 52,000 as of January 15. The company is one of the hottest biotechs on the market after its IPO just over two years ago – and for good reason.
After a decade of research and development and receiving more than $ 3 billion in funding, Moderna has achieved a major scientific achievement in validating the use of messenger RNA (mRNA) technology in vaccines. Its momentum is far from over, however. Today, let’s see why Moderna is one of the top coronavirus stocks for the New Year.
Image source: Getty Images.
An excellent vaccine against the coronavirus
In clinical trials, Moderna’s vaccine (mRNA-1273) has been shown to be 95% effective in preventing COVID-19 infections and has been shown to be fully effective in preventing severe cases of COVID-19. Based on these positive results, regulatory agencies in more than 30 countries have cleared the vaccine for use.
So far, the company has received $ 2.89 billion in vaccine payments and expects it to generate $ 11.7 billion in revenue this year from sales of mRNA-1273 alone. . In 2019, the company generated just $ 60.2 million in revenue for the entire year.
At present, the company is conducting a series of concurrent clinical trials to extend the use of the vaccine to young children and adolescents, and is testing a booster injection for adults. Moderna expects the protection of its vaccine to last at least a year. Subsequently, a naturally waning immune response may require patients to receive additional doses. This would likely allow Moderna to generate annual income given the transmissibility of the virus and the need to be vaccinated in at least 82% of the general population to prevent further epidemics.
You could say Moderna has the most innovative pipeline in the entire industry. The company is currently studying four top-notch vaccines for respiratory disease. A candidate, mRNA-1647, for immunization against cytomegalovirus (CMV), is headed for phase 3 trials this year. CMV is a herpes-like virus that remains the leading cause of birth defects worldwide. If successful in this investigation, Moderna expects the vaccine to generate between $ 2 billion and $ 5 billion in peak annual revenue.
The company is also studying 13 mRNA therapies targeting cancers, rare diseases, cardiovascular diseases and autoimmune diseases. So far, it has more than sufficient capital to finance these research and development expenses. The company’s cash flow and investments total $ 5.25 billion, without any debt.
Points to remember for investors
Given its strong coronavirus vaccine, promising pipeline, and strong financial position, I would say Moderna is one of the top coronavirus stocks for 2021. It is currently trading for 4.8 times its future earnings, which is pretty inexpensive considering the company could add 10 digits to its sales this year.
The company has more than enough manufacturing capacity to maintain vaccine deliveries. This year, it plans to produce between 600 million and 1 billion doses. By the end of 2022, Moderna expects to achieve an annual production rate of 1.3 billion doses. For these reasons, I think this is one of the best biotech to buy for the New Year.
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