Novavax, Inc. (NASDAQ:NVAX) shares collapsed nearly 82% this morning, after the vaccine maker announced that RESOLVE, a Phase III trial in older adults with its RSV F protein vaccine candidate, did not meet its pre-specified primary and secondary efficacy objectives and did not demonstrate vaccine efficacy.
However, FBR analyst Vernon Bernardino remains bullish, believing that the pullback in the stock represents a strong buying opportunity.
Bernardino noted, “While RESOLVE failed to show that annual vaccination conferred adequate protection, top-line results from the Phase II rollover trial, which evaluated the efficacy of a second vaccination, were positive and supported a path forward and the merits of conducting an additional Phase III study. The result is a delay in expected approval of the RSV vaccine (we move our projection from 2019 to 2020).”
“We think NVAX was savvy in conducting the rollover study: Its design had elements of a registrational pivotal trial. Thus, the path forward with the RSV vaccine may likely be driven by results from this exploratory trial,” the analyst added
Bernardino reiterated an Outperform rating on Novavax shares, while lowering his price target to $12 (from $17).
As usual, we recommend taking analyst notes with a grain of salt. According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Vernon Bernardino has a yearly average return of -15.5% and a 27% success rate. Bernardino is ranked #4025 out of 4158 analysts.
Out of the 5 analysts polled by TipRanks (in the past 3 months), 3 rate Novavax stock a Buy, while 2 rate the stock a Hold. With a return potential of 85%, the stock’s consensus target price stands at $15.44.