Among the U.S.-based companies that are distributing novel coronavirus vaccines to the public, Moderna (NASDAQ:MRNA) has been one of the most successful. Largely as a result of this, MRNA stock has done quite well during the past year.
Admittedly, there are skeptics who would be happy to see the bull run come to a screeching halt. And, a recent statement from a U.S. trade representative might give the short sellers some ammunition.
On the other hand, the seemingly bearish news might not pack the punch that the MRNA stock haters think it does.
Besides, some recently released fiscal data reflects a crucial milestone for Moderna. All in all, the bulls should conclude that the good news outweighs the bears’ concerns.
MRNA Stock at a Glance
Believe it or not, MRNA stock traded for less than $60 a year ago. Anyone who simply applied a buy-and-hold strategy would be doing extremely well today.
November 2020 was like a launch pad for the stock as it shot up from $67 to $152 during that month. After that came a roller-coaster ride, though as it turns out, the best policy was simply to hold on to your shares.
At $189.26 per share, Feb. 8, 2021 marked an impressive 52-week high for MRNA stock. The stock slid towards $160 during the next couple of trading days, but the long-term trend is definitely to the upside.
The future trajectory for Moderna shares will depend on how the market processes multiple pieces of information. We’ll start with the bad news first, though you might decide that it’s not so terrible after all.
Moderna’s Intellectual Property Concerns
For a while, it seemed as if the Biden administration might not support waiving intellectual property protections for the Covid-19 vaccines produced by manufacturers like Moderna.
However, on May 6, the administration issued a statement suggesting that in actuality, it would support waiving those protections.
U.S. Trade Representative Katherine Tai stated, “The Administration believes strongly in intellectual property protections, but in service of ending this pandemic, supports the waiver of those protections for Covid-19 vaccines.”
Most likely, the Biden administration is taking this stance in the hope of unlocking more Covid-19 vaccine supply.
Could this negatively impact Moderna’s bottom line? Perhaps, but it might not be as bad as the bears would assume.
Moderna CEO Stéphane Bancel reacted calmly to Tai’s statement. “I believe it doesn’t change anything for Moderna … We saw the news last night. I didn’t lose a minute of sleep over the news,” Bancel said.
Moreover, Raymond James analyst Chris Meekins brought up a good point. Meekins pointed out that the waiver “will take months or years to set up.” Consequently, the waiver wouldn’t “have an immediate impact even if it
were to go through,” Meekins added.
Don’t Worry, Be Happy
Instead of worrying about something that might take place down the road, why not celebrate some positive developments?
For the first quarter of 2021, Moderna reported its first-ever quarterly profit. Not only that, but it was the company’s first billion-dollar quarter.
Try as they might, the bears simply won’t be able to deny those milestones. They can read the first-quarter stats and weep:
- Earnings of $1.2 billion, which translates to $2.84 per share (vast improvement over the loss of $124 million, or 35 cents per share, recorded in the year-ago quarter)
- $1.9 billion in sales
- $1.7 billion in Covid-19 vaccine sales
- Shipped a whopping 102 million doses of the company’s Covid-19 vaccine during the quarter
On top of all that, Moderna plans to supply a total of 800 million doses of its Covid-19 vaccine this year — pretty amazing, if you think about it.
This isn’t even a “glass-half-full” type of situation. It’s really just a bullish scenario, with a concern that might not materialize for a while.
Therefore, it’s reasonable to hold MRNA stock, or even pick some shares up if you haven’t done so already.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
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