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Time to Buy Moderna-Heavy ETFs on Vaccine Optimism?
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Shares of Moderna (MRNA - Free Report) witnessed a significant increase of more than 13% on Tuesday, driven by Oppenheimer's decision to upgrade the stock to "outperform," as quoted on CNBC. The upgrade is based on the belief that Moderna, a Covid vaccine manufacturer, could potentially introduce five new products to the market by 2026.
Challenging 2023 for Moderna
The upgrade comes after a challenging year in 2023 for Moderna, a year in which its sole commercially available product was the Covid vaccine. The company's stock performance has historically been closely tied to the success of its vaccine, and in the previous year, its shares declined by nearly 45% as global demand for Covid-related products decreased significantly.
Outlook on Covid Sales and Beyond
Oppenheimer analyst Hartaj Singh predicts that Moderna's Covid vaccine sales could hit a low point in 2024, primarily due to factors like vaccine fatigue. However, the firm anticipates a resurgence in Covid vaccine sales starting in 2025 and beyond, driven by increased public education about Covid and higher spending on disease awareness campaigns.
Optimism Regarding Moderna's Pipeline
Singh expressed a more optimistic outlook for Moderna's pipeline, highlighting several potential product launches within the next 12 to 18 months that could boost sales in 2025. Notable developments include the potential approval of Moderna's experimental vaccine designed to protect older adults from respiratory syncytial virus (RSV), a virus causing mild symptoms in most but severe issues in seniors and children. The Food and Drug Administration is expected to make a decision on the RSV vaccine in April.
Potential Approvals for Flu and Cancer Vaccines
Additionally, Moderna's experimental flu vaccine could receive approval in either 2024 or 2025, as it demonstrated a stronger immune response against four flu virus strains compared to the currently available vaccine during late-stage trials. Singh also mentioned the possibility of Moderna filing for FDA approval for its experimental personalized cancer vaccine in 2024 or 2025, potentially leveraging the FDA's accelerated approval pathway.
Collaboration with Merck and Future Expectations
Moderna is collaborating with Merck to study the combination of their vaccine with Merck's Keytruda therapy for the treatment of melanoma and other cancers. In a shareholder letter, Moderna reiterated its expectation of sales growth in 2025, emphasizing its RSV vaccine and the potential approval of a combination vaccine targeting both Covid and the flu as early as 2025.
ETFs in Focus
Moderna comes from a top-ranked Zacks sector (top 44%) and Zacks industry (top 33%). Against this backdrop, investors can play Moderna-heavy biotech ETFs.
ETFMG Treatments Testing and Advancements ETF (GERM - Free Report) – Moderna has a 6.69% focus
VanEck Biotech ETF (BBH - Free Report) – Moderna has a 5.34% focus
iShares Genomics Immunology and Healthcare ETF (IDNA - Free Report) – Moderna has a 4.47% focus
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)
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Time to Buy Moderna-Heavy ETFs on Vaccine Optimism?
Shares of Moderna (MRNA - Free Report) witnessed a significant increase of more than 13% on Tuesday, driven by Oppenheimer's decision to upgrade the stock to "outperform," as quoted on CNBC. The upgrade is based on the belief that Moderna, a Covid vaccine manufacturer, could potentially introduce five new products to the market by 2026.
Challenging 2023 for Moderna
The upgrade comes after a challenging year in 2023 for Moderna, a year in which its sole commercially available product was the Covid vaccine. The company's stock performance has historically been closely tied to the success of its vaccine, and in the previous year, its shares declined by nearly 45% as global demand for Covid-related products decreased significantly.
Outlook on Covid Sales and Beyond
Oppenheimer analyst Hartaj Singh predicts that Moderna's Covid vaccine sales could hit a low point in 2024, primarily due to factors like vaccine fatigue. However, the firm anticipates a resurgence in Covid vaccine sales starting in 2025 and beyond, driven by increased public education about Covid and higher spending on disease awareness campaigns.
Optimism Regarding Moderna's Pipeline
Singh expressed a more optimistic outlook for Moderna's pipeline, highlighting several potential product launches within the next 12 to 18 months that could boost sales in 2025. Notable developments include the potential approval of Moderna's experimental vaccine designed to protect older adults from respiratory syncytial virus (RSV), a virus causing mild symptoms in most but severe issues in seniors and children. The Food and Drug Administration is expected to make a decision on the RSV vaccine in April.
Potential Approvals for Flu and Cancer Vaccines
Additionally, Moderna's experimental flu vaccine could receive approval in either 2024 or 2025, as it demonstrated a stronger immune response against four flu virus strains compared to the currently available vaccine during late-stage trials. Singh also mentioned the possibility of Moderna filing for FDA approval for its experimental personalized cancer vaccine in 2024 or 2025, potentially leveraging the FDA's accelerated approval pathway.
Collaboration with Merck and Future Expectations
Moderna is collaborating with Merck to study the combination of their vaccine with Merck's Keytruda therapy for the treatment of melanoma and other cancers. In a shareholder letter, Moderna reiterated its expectation of sales growth in 2025, emphasizing its RSV vaccine and the potential approval of a combination vaccine targeting both Covid and the flu as early as 2025.
ETFs in Focus
Moderna comes from a top-ranked Zacks sector (top 44%) and Zacks industry (top 33%). Against this backdrop, investors can play Moderna-heavy biotech ETFs.
ETFMG Treatments Testing and Advancements ETF (GERM - Free Report) – Moderna has a 6.69% focus
VanEck Biotech ETF (BBH - Free Report) – Moderna has a 5.34% focus
iShares Genomics Immunology and Healthcare ETF (IDNA - Free Report) – Moderna has a 4.47% focus
(Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.)