Moderna, Inc. (MRNA), known for its messenger RNA (mRNA) therapeutics and vaccines, confirmed the purchase of 150 million additional COVID-19 vaccine doses by the European Commission, to be delivered in 2022. Shares jumped 6.3% to close at $221.36 on June 22.
With the latest purchase, the confirmed order commitment from the European Commission increased to 460 million doses, including the option to buy other COVID-19 vaccine candidates from the company’s pipeline. However, the delivery of Moderna’s updated variant booster vaccine candidate will begin in 2022, only after receiving the regulatory approval from the European Medicines Agency (EMA).
The company’s CEO, Stephane Bancel, said, “We are encouraged by the initial booster data, which reinforces our confidence that our booster strategy should be protective against current variants. We will remain proactive as the virus evolves by leveraging the flexibility of our mRNA platform to stay ahead of emerging variants.”
The vaccine doses could be used for primary vaccination, including that of children, or even as a booster if required. The company is on track with its quarterly delivery commitment to the European Union in 2021.
Following the news, Piper Sandler analyst Edward Tenthoff maintained a Buy rating on the stock with a price target of $246 implying 11.1% upside potential from current levels.
Tenthoff believes Moderna is poised for “several years” of Covid vaccine sales. His projection includes sales of Moderna’s booster doses, which are effective for long-term immunity and protection against emerging variants. The analyst projects sales from the mRNA-1273 to reach $13.07 billion in 2021 and $21.25 billion in 2022, driving the company’s profitability and cash flows.
The rest of the Street is cautiously optimistic about the stock, with a Moderate Buy consensus rating based on 6 Buys, 3 Holds, and 2 Sells. The average analyst Moderna price target of $194 implies 12.4% downside potential from current levels. Shares have exploded 251.7% over the past year.
Also, Moderna scores a 9 of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.
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