Why Novavax Stock is Near 52-Week Lows

Vaccine stock Novavax (NVAX) dropped a massive 13.4% on Tuesday and reached a new 52-week low of $64.64 during the day. The stock declined a further 3.9% in today’s trading session so far.

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Wondering what could have happened that resulted in such a pessimistic reaction for the stock?

Investors are likely to have been eagerly waiting for Novavax’s COVID-19 vaccine, NVX-CoV2373, to be approved by the U.S. Food and Drug Administration (FDA) under Emergency Use Authorization (EUA) as a booster shot in adults aged 18 years and above.

However, comments of the director of the National Institute of Allergy and Infectious Diseases, Dr. Anthony Fauci, might have pulled hopes down to some extent. Fauci said that it is a bad idea to wait for vaccines to be approved in the U.S.

Notably, the FDA has recently approved the second booster shots of Moderna (MRNA) and Pfizer (PFE)/ BioNTech (BNTX) vaccines for people aged over 50 years.

Takeaway

A fresh surge of cases in China is likely to be welcomed as good news by vaccine stocks, including Novavax. It would be a way to boost their top lines by selling their vaccines in the most affected countries.

Novavax’s vaccine is among the first to be approved for use in adolescents aged 12 to below 18 years in India. Further, in case the FDA approves the vaccine, it would come as another major positive factor for the company and provide support in achieving its targets for 2022.

Wall Street’s Take

B.Riley Financial analyst Mayank Mamtani reiterated a Buy rating on the stock with a price target of $250 (~300% upside potential).

Mamtani said, “…the near-term backdrop on NVAX shares remain largely centered on the company and its strategic partners, e.g., SRII, SK Bio, Takeda, Fujifilm, meeting on stated delivery goals globally that build into company’s FY22 revenue guidance of $4-5 billion.”

He continued, “We believe NVAX’s manufacturing capacity issue remains misunderstood by investors, notably the 2 billion annual run rate for 2022, and is often confused with procurement dynamics from large-scale bulk buyers, …and pediatric vaccination campaigns centered around the most effective, safe vaccine platforms.”

NVAX stock comes in as a Moderate Buy on Wall Street based on five Buys and two Holds assigned in the past three months. The average Novavax price target stands at $179.86 and implies an upside potential of 187.6% from current levels.

News Sentiment

News Score for Novavax is Neutral, based on 30 articles written over the past seven days. All articles have Bullish sentiment, compared to a sector average of 62%. None have Bearish Sentiment, compared to a sector average of 38%.

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