Novavax (NVAX) might still be waiting for emergency use authorization (EUA) in the US for its Covid-19 vaccine NVX-CoV2373, but B. Riley analyst Mayank Mamtani notes two recent key developments which bolster the vaccine’s “long-term competitive positioning.”
One concerns a recent head-to-head immune profiling study overseen by “independent, highly reputable research groups (La Jolla Institute, USCD)” which showed that, both on durability and cross-variant protection, Novavax’ offering was “at least at par (if not better)” when compared to mRNA vaccines.
Secondly, the vaccine has been authorized for emergency-use in India for children aged between 12 and 17. Globally, this is the first authorization for the vaccine for this age group. Recall, the Serum Institute of India is responsible for the vaccine’s manufacturing and marketing in India, where it is branded as Covovax.
“We find these relatively under-the-radar developments to be particularly informative to the Street’s two key focus areas on pipeline,” Mamtani noted.
Looking ahead, the analyst expects: “(1) grant of U.S. EUA, now that the full clinical and CMC regulatory package has been sitting with agency with review timelines substantially longer than prior EUAs granted to PFE, MRNA and JNJ; and (2) upcoming April C-19/flu combination dataset, primarily aimed at improving on reactogenicity profile observed with mRNA platform with multi-variant vaccines.”
However, more than that, Mamtani thinks the shares’ performance will depend on Novavax meeting its global delivery targets. The company has guided for FY22 revenue between $4-5 billion. Going by recent checks, Mamtani reckons that Q1’s revenue targets are “likely to be exceeded.” The analyst estimates sales could be as high as ~$930 million, which is both above his $690 million estimate and the Street’s $700 million forecast. However, currently, the picture remains “less clear” on whether the full-year target can be achieved.
All in all, Mamtani has a Buy rating for NVAX stock, backed by a confident $250 price target. Should the figure be met, investors are looking at 12-month returns of 217%. (To watch Mamtani’s track record, click here)
While the Street’s average target is not quite as exuberant, at $179.86, the figure is still set to generate 12-month returns of 128%. Looking at the consensus breakdown, based on 5 Buys and 2 Holds, the analysts’ view is that this stock is a Moderate Buy. (See Novavax stock forecast on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.