SVB Securities, a division of SVB Financial Group (NASDAQ: SIVB), believes BioNTech SE – ADR (NASDAQ: BNTX) stock is trading below the most negative scenario for the COVID-19 vaccine market.
The SVB Financial Analyst: Daina M. Graybosch upgraded the stock from Market Perform to Outperform and lowered the price target from $253 to $223.
The BioNTech Thesis: Graybosch lowered the price target as a slight downtick is expected for revenue for BioNTech's second quarter, even though the analyst believed that annual COVID-19 booster shots, which would bring in steady revenue, are still a strong possibility and BioNTech is one the leaders in vaccine production.
While annual boosters would help the company’s revenue, Graybosch shared that annual boosters would be met with low adherence from the public, adding that a past COVID-19 infection provided more protection than a booster shot and sentiment could decrease public demand for a booster.
The note also shared that re-infection decreases the real-world effectiveness of the vaccine.
Also Read: FDA Eyes New Vaccine Composition In Response To COVID Mutations: Here's What You Need To Know
In addition to the COVID-19 vaccine market, Graybosch saw value in BioNTech’s oncology sector. BioNTech has been working on a program known as iNeST which focuses on creating a different treatment for each patient through blood work and other samples. The analyst believed in the long-term success of the program and the possibilities it will bring to BioNTech.
Overall, Graybosch had a very optimistic outlook on BioNTech and foresaw a strong future for the biotech growth stock as it introduces iNeST in the coming years along with continuing to supply COVID-19 vaccines around the globe. While decreasing the company’s price target could be seen as a negative, improving stock conditions to Outperform could be good for BioNTech and its shareholders.
BNTX Price Action: BioNTech closed Wednesday up 3.22% at $166.62 a share according Benzinga Pro.
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