Moderna's Q3 Numbers May Have Seemed Impressive, but They Aren't Enough to Make the Stock a Buy
Key PointsModerna's revenue came in better than expected last quarter, and the company raised its guidance.
Moderna's Q3 earnings have caused its stock to rise, but there are concerns that the numbers may not justify buying the stock. The company reported nearly $1.3 billion in revenue for the September quarter, up from $1 billion the previous year, with COVID-19 related products accounting for 98% of the top line. However, this is still down from $5 billion five years ago.
The updated guidance calls for a 15% to 25% revenue growth for the full year, which would mean $2.4 billion in revenue at the high end, but this is not enough to justify the company's $110 billion market cap. The company is working on a personalized cancer vaccine with Merck, but it isn't approved yet and faces challenges in mass production and sharing revenue with Merck.
The excitement around the vaccine may be high, but if it fizzles, Moderna's stock could experience a significant correction.
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