What to look for in the MRNA

Moderna Inc. (MRNA), the young biotechnology company focused on the development of messenger RNA-based drugs and vaccines, attracted great attention last year for its role in the development of a vaccine against COVID-19. Until mRNA-1273, Moderna’s coronavirus vaccine, the company had never launched an approved drug on the market.Now, he is about to make huge profits from a vaccine that millions of people around the world are desperately waiting for.

Investors will be watching how mRNA-1273 sales reinforce Moderna’s financial results when the company reports earnings on February 25, 2021 for the fourth quarter of fiscal 2020.Analysts expect Moderna to post another adjusted loss per share, although it is the lowest quarterly adjusted loss in at least three and a half years, a period in which it never made a profit. Revenue is expected to skyrocket compared to the previous year’s quarter.

Investors will also be focused on whether Moderna will provide guidance for the first quarter of fiscal 2021 and, if so, what the expected impact of mRNA-1273 sales will be on overall financial results. The company’s vaccine was only approved by the United States Food and Drug Administration (FDA) at the end of last year, which means that most of the sales will be generated from 2021.Analysts are extremely optimistic, forecasting a profitable first quarter for fiscal year 2021, as revenue continues to grow.

Moderna’s shares, which began publicly traded in late 2018, soared last year. The exceptionally rapid increase in stocks was fueled by investor optimism about the development of its coronavirus vaccine, in which the company started work in January 2020.After early data in mid-November demonstrated that the vaccine’s efficacy rate was as high as 94.5%, the stock’s rise accelerated rapidly before reaching its peak in early December.The shares returned some of those gains, even when the U.S. government gave emergency authorization to use the Modern vaccine (UAE) in mid-December. Then, the stock resumed its bullish momentum for new highs. Moderna’s shares provided a total return of 757.3% in the last 12 months, well above the total return of the S&P 500 of 20.2%.

The shares have been relatively insensitive to Moderna’s weak earnings reports in recent quarters, fueled by optimism about future profitability generated by vaccine sales. The company reported an adjusted loss per share of $ 0.53 in the third quarter of fiscal 2020. Revenue increased 826.4%, marking the second consecutive quarter of growth.However, total revenue was driven mainly by increases in concession revenue, mainly due to the company’s agreement with the Advanced Biomedical Research and Development Authority (BARDA) related to the development of mRNA-1273.

In the second quarter of fiscal 2020, Moderna recorded an adjusted loss of $ 0.24 per share. Revenue increased 407.2%, the first increase since the third quarter of fiscal 2018. The company said the growth in total revenue was attributable to increases in collaboration and grant revenues.The growth in collaboration revenue was mainly due to a collaboration with AstraZeneca PLC (AZN). The increase in donation revenue was mainly attributable to the BARDA agreement mentioned above, related to the vaccine against COVID-19.

Analysts expect a continuous improvement in Moderna’s financial results in the fourth quarter of fiscal 2020. The company is expected to post an adjusted loss per share of $ 0.22, which would be the lowest adjusted loss in at least 14 quarters. Revenue is expected to increase 2,169.1%, far exceeding any quarterly growth figures in recent years. It would also mark the third quarter of revenue growth, after six consecutive quarters of revenue decline. For fiscal 2020, analysts are forecasting an adjusted loss per share of $ 1.32, as revenue increases 816.1%. It would be the first year of annual revenue growth since fiscal 2017.

Modern Key Metrics
	Estimate for Q1 2021 (FY)	Estimate for Q4 2020 (FY)	Fourth quarter of 2019 (fiscal year)	Fourth quarter of 2018 (fiscal year)
Adjusted earnings per share ($)	2.42	-0.22	-0.31	-0.88
Revenue ($ M)	1,757.4	318.9	14.1	35.4

Source: Visible Alpha

As mentioned above, investors will also be aware of Moderna’s future direction for future periods, especially the current first quarter and fiscal year 2021. Moderna has already generated some revenue related to its COVID-19 vaccine, but this was mainly due to the concession revenue from your BARDA contract. But since its vaccine was only approved in the United States in late 2020, Moderna’s revenue growth and overall growth potential have yet to be realized. In the announcement of fourth quarter earnings and management comments, investors will seek guidance from Moderna on the magnitude of future earnings and earnings. In the company’s third quarter earnings report, CEO Stéphane Bancel said: “I believe that if we launch our COVID-19 vaccine, 2021 could be the most important turning point in the history of Moderna.”

Analysts are currently forecasting Moderna to report an adjusted earnings per share (EPS) of $ 2.42 in the first quarter of fiscal 2021. It would be the first quarter of profitability in at least 15 quarters. Revenue is expected to explode upward by 20,848.7% compared to the previous year’s quarter, as the use of its COVID-19 vaccine increases worldwide. For fiscal year 2021, analysts forecast adjusted EPS of $ 20.33 as annual revenue rises 2,001.9%. But some analysts say these rising profits may not last forever, because Moderna’s unexpected profits may attract more rivals to the market. Although Moderna is one of the first to develop a vaccine against coronavirus, it may be necessary to prepare to protect its considerable market share.