Why Moderna Stock Was Sick on Monday
What happened
Already contending with notable drops in COVID cases and fatalities, Moderna (NASDAQ: MRNA) -- a stock closely associated with the pandemic -- suffered a fresh decline on Monday. Bearishness on the company was exacerbated by an analyst's price-target cut that morning, and the shares fell by more than 7% on the day.
So what
The analyst in question was Deutsche Bank's Emmanuel Papadakis, who shaved $20 off his existing price target on Moderna stock for a new level of $155. He is maintaining his hold recommendation on the shares.
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Referring to the company's fourth-quarter results, published in late February, Papadakis described Moderna's performance as "relatively solid." He also views the stock as having "good fundamental valuation support" at the current price.
Now what
While Papadakis didn't seem overly impressed by Moderna's quarter, the company did post a pair of convincing beats. Its per-share net profit was $11.29, which was significantly better than the average analyst estimate of $9.90. Revenue of $7.2 billion also topped expectations. Collectively, those prognosticators were modeling a top-line tally of just under $6.8 billion.
Moderna also announced a major shareholder-pleasing move by unveiling a new share-repurchase program. This initiative will see the biotech buy back up to $3 billion worth of its stock, three times the amount of the company's previous initiative, which had been fully utilized by the end of January.
The company's most recent news has generally been positive, and its coronavirus vaccine remains a go-to jab in many jurisdictions (including the U.S.). All in all, the stock has generally been on a tear through the pandemic. But now that COVID is (hopefully) fading somewhat, investors might be concerned that it's a bit of a one-trick pony, although it does have numerous, promising pipeline treatments in development.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool recommends Moderna Inc. The Motley Fool has a disclosure policy.
