Today, shares of Covid-19 vaccine maker Novavax (NASDAQ:NVAX) are absolutely plummeting. Indeed, NVAX stock is seeing declines of more than 20% at the time of writing on very heavy volume.
Today’s move brings NVAX stock basically to the levels it started the month at. Over the past few trading days, Novavax has seen a surge of investor interest, which has driven shares markedly higher in a very short amount of time.
That said, some big news today is bringing NVAX shares back down to earth. Let’s dive into what the company announced and why investors are growing increasingly bearish on this stock.
NVAX Stock Down After Emergency Use Authorization Delayed
Today, NVAX stock is back down to levels the company started the week at. The move essentially erases the optimism that was being priced into this stock on Wednesday and Thursday.
Shares surged on news that Novavax had secured vaccine supply deals with the European Union. These deals were a culmination of some strong data coming out of the company’s initial trials, published this spring. The company’s Covid-19 vaccine hit 90% efficacy levels against Covid variants, a significant milestone given where we’re at in terms of the pandemic.
Accordingly, investors had priced in increased expectations that this vaccine could eventually be approved by U.S. regulators. However, the company announced today that it is delaying its submission to the U.S. regulator for an emergency use authorization (EUA) for its vaccine candidate.
This announcement clearly surprised the market. Accordingly, investors seem to be repricing the future value of this company’s prospective cash flows in a big way today. That said, it’s intriguing that this stock has given up essentially all of its gains over the past two trading days, which were achieved as a result of a completely different catalyst.
However, prospective vaccine players still remain highly volatile bets. The price action on NVAX stock over the past three trading days has been tumultuous. Indeed, this price action is a good indication of what investors putting money to work in such stocks can expect.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.