What happened
Actions of Novavax (NASDAQ: NVAX) were rising 19.1% at 12:08 am EST on Monday. This big gain came after the stock skyrocketed on Friday following its announcement of positive end-stage results for the candidate vaccine COVID-19 NVX-CoV2373.
Today’s leap appears to be due in part to last week’s continued momentum. In addition, B. Riley Securities analyst Mayank Mamtani raised his target price on Novavax from $ 223 to $ 334, reflecting a 51% premium on Friday’s closing price.
And
It is impossible to determine how much of today’s gain for Novavax resulted from Mamtani’s optimistic outlook on biotechnology stocks. However, the underlying reasons for his optimism seem to be right.
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Mamtani wrote to investors that Novavax should have “significant competitive differentiation” in the COVID-19 vaccine market. The high effectiveness of NVX-CoV2373 and its logistical advantages (including no ultracold storage requirements) should help make it a major commercial winner, assuming the vaccine guarantees regulatory authorizations.
The analyst also pointed out that Novavax has another vaccine candidate with a lot of potential. The company reported positive results in the final stage of the experimental NanoFlu flu vaccine last year. Mamtani hopes that biotechnology will gain significant market share in the fast-growing markets for COVID-19 and flu vaccines.
What now
There are two important milestones to note with Novavax now. First, the company must be in a strong position to soon obtain authorization for NVX-CoV2373 in the United Kingdom. Second, Novavax is conducting another final-stage study of the vaccine in the US and Mexico. The results of this study are expected to be available in the coming months.