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Stocks of major vaccine makers rose on Monday amid renewed outbreak of COVID-19. Moderna CEO adds that vaccine makers have a huge opportunity for growth.
Moderna Inc (NASDAQ: MRNA), BioNTech SE (NASDAQ: BNTX), and Novavax Inc (NASDAQ: NVAX) all saw their stock prices rise remarkably in the face of renewed mounting cases of coronavirus. Investors are placing their faith in these companies’ stocks with strategic optimism. The rationale behind this move is that the companies’ products will be in even higher demand going forward since governments across the globe look to contain the spread. As a result, they are now turning to these pharmaceutical and biotech companies to supply the antidotes in large amounts, causing the vaccine stocks to rise.
Moderna shares rose 17% on Monday, as the company benefited from a huge supply opportunity to Australia. The country granted Moderna provisional registration to supply up to 25 million vaccine doses to the Australian government by 2022. The Australian Therapeutic Goods Administration oversaw the process and will immunize all persons who are at least 18 years old. Moderna will initially supply 10 million doses in 2021 starting in September. According to the terms of the contract, Australia has the option to purchase an additional 15 million doses in 2022 from Moderna. So far this year, Moderna stock has risen 333.9% compared to the 18.1% recorded by the S&P 500 for the same duration.
BioNTech, another major player in the production of coronavirus antidotes also revealed better-than-expected earnings in its Q2 report as it’s shares rose 15%. The German biotechnological company’s sales and adjusted profits for the second quarter hit $6.2 billion and $12.67 per share respectively. These figures far exceeded analysts’ estimates of $3.8 billion and $8.87 per share. In light of this, BioNTech is now anticipating $18.7 billion in sales this year.
Novavax also benefited from the surge in renewed investment interest in vaccine producers. The American biotechnological company’s stock rose 12% and recently benefited from a Barron’s report which advised investors to buy NVAX stock.
The New York State Retirement Fund recently increased its stake in Novavax and several other vaccine stocks. The third-largest public pension fund bought 30,356 more shares in Novavax, taking the total number of shares owned to 85,054. The biotech company’s stock rose 90.4% in the first half of the year but recently took a slight dent. The dip was because Novavax chose to delay seeking US emergency authorization for coronavirus antidotes. The company said it would do so in the fourth quarter of the year as it is currently working to finish the manufacturing part of its application. Upon approval of its antidote, Novavax could potentially supply up to 200 million doses of its vaccine to the European Union.
Vaccine Stocks, What’s Next?
Moderna CEO Stéphane Bancel believes there is a huge market opportunity for vaccine makers. According to the CEO, this is because everyone is seeking the administration of booster shots. Bancel notes that this void is even bigger than originally thought. In an interview with Barron’s, the company CEO was also quick to point out that “coronavirus vaccines won’t provide lifelong immunity.”