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Moderna (MRNA) Down Despite Maintaining COVID Jab Sales View
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Shares of Moderna (MRNA - Free Report) lost 6.5% on Monday, a day after rival Pfizer (PFE - Free Report) slashed its previously issued revenue guidance for 2023 due to lower-than-expected demand for its COVID products.
Pfizer lowered from $67.0 to $70.0 billion to $58.0 to $61.0 billion, which includes a $7 billion cut in Paxlovid revenues and a $2 billion reduction in Comirnaty revenues. Alongside the revised guidance, PFE also announced cost cuts, including layoffs, which are expected to deliver targeted savings of at least $3.5 billion. Pfizer is also expected to record a non-cash charge of $5.5 billion as COVID inventory write-offs in the cost of goods sold in the third quarter.
Due to the lower-than-expected COVID revenues and inventory write-offs, Pfizer now expects its adjusted EPS between $1.45 to $1.65, down from the earlier guidance of $3.25 to $3.45.
In response to Pfizer’s announcement, Moderna stated it “remains comfortable” with its previously issued guidance. Though the company reiterated its full-year 2023 product revenue guidance for COVID-19 vaccine sales to be between $6.0 billion and $8.0 billion, it did warn investors that it could not predict exact demand till it observes the full vaccination trends through October. Based on this observed trend, management will provide an update when it reports its Q3 earnings results on Nov 2.
Despite Moderna sticking to its forecasts, it failed to calm investors sentiments who now raised concerns on the unpredictable demand for the COVID vaccine shots. Though Pfizer’s shares weren’t affected by the news so much, Moderna’s shares fell likely because the company’s COVID vaccines are the only approved/authorized marketed product in its portfolio.
In the year so far, shares of Moderna have declined 48.8% compared with the industry’s 18.9% fall.
Image Source: Zacks Investment Research
The guidance cut by Pfizer also led to a decline in the share prices of its partner BioNTech (BNTX - Free Report) and rival Novavax (NVAX - Free Report) . Shares of BioNTech and Novavax were down 6.4% and 6.0%, respectively, on Monday, as similar to Moderna, these companies are entirely dependent on COVID vaccine sales for revenue.
In a separate press release, BioNTech announced that it expects to record a non-cash charge for inventory write-offs related to Comirnaty up to €0.9 billion in the third quarter. This figure represents BioNTech’s half under the gross profit-sharing agreement with Pfizer.
Novavax recently received permission from the FDA and CDC to use its updated protein-based COVID-19 vaccine in individuals 12 years and older. In a separate press release, Novavax also stated that it “remains confident” in the ongoing commercial rollout of its vaccine and will evaluate the vaccination rates in the country to understand the market better. Based on this understanding, it will provide an update alongside its Q3 results, which can be expected early next month.
Image: Shutterstock
Moderna (MRNA) Down Despite Maintaining COVID Jab Sales View
Shares of Moderna (MRNA - Free Report) lost 6.5% on Monday, a day after rival Pfizer (PFE - Free Report) slashed its previously issued revenue guidance for 2023 due to lower-than-expected demand for its COVID products.
Pfizer lowered from $67.0 to $70.0 billion to $58.0 to $61.0 billion, which includes a $7 billion cut in Paxlovid revenues and a $2 billion reduction in Comirnaty revenues. Alongside the revised guidance, PFE also announced cost cuts, including layoffs, which are expected to deliver targeted savings of at least $3.5 billion. Pfizer is also expected to record a non-cash charge of $5.5 billion as COVID inventory write-offs in the cost of goods sold in the third quarter.
Due to the lower-than-expected COVID revenues and inventory write-offs, Pfizer now expects its adjusted EPS between $1.45 to $1.65, down from the earlier guidance of $3.25 to $3.45.
In response to Pfizer’s announcement, Moderna stated it “remains comfortable” with its previously issued guidance. Though the company reiterated its full-year 2023 product revenue guidance for COVID-19 vaccine sales to be between $6.0 billion and $8.0 billion, it did warn investors that it could not predict exact demand till it observes the full vaccination trends through October. Based on this observed trend, management will provide an update when it reports its Q3 earnings results on Nov 2.
Despite Moderna sticking to its forecasts, it failed to calm investors sentiments who now raised concerns on the unpredictable demand for the COVID vaccine shots. Though Pfizer’s shares weren’t affected by the news so much, Moderna’s shares fell likely because the company’s COVID vaccines are the only approved/authorized marketed product in its portfolio.
In the year so far, shares of Moderna have declined 48.8% compared with the industry’s 18.9% fall.
Image Source: Zacks Investment Research
The guidance cut by Pfizer also led to a decline in the share prices of its partner BioNTech (BNTX - Free Report) and rival Novavax (NVAX - Free Report) . Shares of BioNTech and Novavax were down 6.4% and 6.0%, respectively, on Monday, as similar to Moderna, these companies are entirely dependent on COVID vaccine sales for revenue.
In a separate press release, BioNTech announced that it expects to record a non-cash charge for inventory write-offs related to Comirnaty up to €0.9 billion in the third quarter. This figure represents BioNTech’s half under the gross profit-sharing agreement with Pfizer.
Novavax recently received permission from the FDA and CDC to use its updated protein-based COVID-19 vaccine in individuals 12 years and older. In a separate press release, Novavax also stated that it “remains confident” in the ongoing commercial rollout of its vaccine and will evaluate the vaccination rates in the country to understand the market better. Based on this understanding, it will provide an update alongside its Q3 results, which can be expected early next month.
Moderna, Inc. Price
Moderna, Inc. price | Moderna, Inc. Quote
Zacks Rank
Moderna currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.