On Thursday, Morgan Stanley (NYSE:MS) maintained its stance on Moderna (NASDAQ:MRNA) shares, reiterating an Equalweight rating with a steady price target of $94.00. Moderna, listed on NASDAQ:MRNA, recently disclosed updates on its portfolio prioritization and revised guidance in preparation for the company's forthcoming R&D day.
Moderna has adjusted its forecast to achieve a break-even status by 2028 on an operating cash cost basis, a delay from the previously anticipated 2026 timeline. The operating cash cost basis excludes factors such as stock-based compensation, and depreciation and amortization expenses. The company has set a revenue goal of $6 billion to coincide with this break-even target.
Moreover, Moderna provided several updates on its pipeline, including information regarding the regulatory feedback for its investigational treatment for melanoma. The initial response from the FDA has not favored an accelerated approval for the melanoma treatment based on the existing data. This feedback may influence the trading performance of Moderna's shares, with expectations of a potential decrease in share price following the announcement.
The company's updates and the revised financial outlook are key factors in the analyst's perspective on Moderna's stock performance. The expectation set by Morgan Stanley suggests that investors may witness a reaction in the market as these details are absorbed by stakeholders.
In other recent news, Moderna has been at the forefront of several key developments. The biotech company announced plans to reduce its R&D expenses by $1.1 billion by 2027, leading to a delay in its profitability timeline until 2028.
The firm's revenue guidance for 2025 has been revised to a range of $2.5 to $3.5 billion, falling short of the market consensus. Despite these changes, Jefferies maintained its Buy rating on Moderna, suggesting the updates align with their projections.
Moderna also highlighted advancements in its vaccine development, with three respiratory vaccines anticipated for regulatory approval in 2024. The company's updated COVID-19 vaccine, Spikevax, targeting the JN.1 variant, is nearing approval in the European Union, following recent authorization in the UK, Japan, and Taiwan.
On the financial front, Brookline Capital Markets and Piper Sandler both maintained their Buy and Overweight ratings on Moderna, projecting the COVID-19 vaccines to generate significant sales for the company in 2024. However, HSBC (LON:HSBA) upgraded Moderna's stock from Reduce to Hold due to an unexpected dip in COVID-19 vaccine revenue. These are the recent developments for Moderna.
InvestingPro Insights
In light of Moderna's recent portfolio updates and revised guidance, a glimpse at the real-time data from InvestingPro provides an additional layer of insight. Moderna's market capitalization stands at $30.56 billion, reflecting the scale of the company within the biotechnology sector. Despite the challenges highlighted, the company holds a noteworthy cash position, with cash exceeding debt on its balance sheet. This financial stability may offer some comfort to investors concerned about the company's short-term obligations.
However, the company's financial performance metrics paint a more cautious picture. With a negative P/E ratio of -5.19 and a significant drop in revenue growth of -52.6% over the last twelve months as of Q2 2024, Moderna's profitability challenges are evident. The InvestingPro data also reveals a gross profit margin of -62.99%, underscoring the cost pressures the company faces.
From an investment standpoint, Moderna's stock price movements have been volatile, with a significant return over the last week, but a notable decline over the last three months. Investors using InvestingPro can access additional tips, with 12 more insights available that could help navigate the uncertainties surrounding Moderna's stock. These insights include analyst expectations, profitability forecasts, and stock price trends, which are crucial for making informed investment decisions.
For those seeking deeper analysis, the InvestingPro platform offers a fair value estimate of $86.86 for Moderna, which investors can compare against current market prices and analyst targets to gauge potential investment opportunities.
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