Novavax (NASDAQ:NVAX) is not a meme stock. But it might as well be. NVAX stock has been making some volatile moves in 2021.
And those moves are entirely based on one thing. Can the company successfully bring its Covid-19 vaccine to market? And if so, where?
I’ve lived my entire life in the Great Lakes region of the United States. It’s an area of the country defined by the phrase, “If you don’t like the weather, wait a few minutes.” That type of uncertainty is more myth than reality. However, you never want that kind of volatility when it comes to a speculative stock. But that’s the situation that’s brewing with Novavax.
To be fair, some of the company’s problems are self-inflicted. The company has been playing its cards close to the vest as far as when it would apply for approval in the United States. After a while, investors can’t be expected to remain patient.
But that delay has also allowed other events to come into play that hurt the bullish case for Novavax. At the end of this article, I don’t know if you’ll be convinced one way or another. But at least, you can decide if the reward is worth the risk.
The Novavax Vaccine Has Advantages
As I and several other InvestorPlace contributors have written, the Novavax vaccine has a couple of key advantages compared to the mRNA vaccines. First, it’s a subunit vaccine. When I wrote about NVAX stock in September, I admitted I hadn’t given the company its due for having a subunit vaccine. This uses part of the pathogen (i.e., a live virus) to train the immune system to fight off infection.
At that time I alluded to something that Josh Enomoto said very clearly, “… those who state that Covid vaccines were rushed should have no science-backed objections with the Novavax jab.”
And perhaps the most notable trait is that it can be refrigerated instead of being kept under sub-zero conditions. While that has nothing to do with the effectiveness of the vaccine, it solves several logistical concerns.
Perception Is Reality
NVAX stock was falling before this week. But it didn’t help that on Oct. 4, Merck (NYSE:MRK) announced good late-stage trial results for a Covid-19 pill. Let’s be clear. This is a therapeutic solution for individuals that are already infected. And for individuals who, for whatever reason, are choosing not to get vaccinated, this could serve as a psychological “get out of jail free” card.
Does it miss the point of the vaccine? I suppose that depends on what point you’re trying to make. In any event, as it relates to Novavax, this can’t be welcome news. Especially because the company has been stubbornly non-committal as to when it would be applying for emergency use authorization in the United States.
With NVAX Stock, the Easy Gains are Long Gone
I’m not going to say that you should categorically dismiss Novavax. The company has deals in place that would solidify its revenue position. But the company does not yet have regulatory approval for its Covid-19 vaccine from any governmental agencies. It has applied for emergency approval from the World Health Organization but at the time I’m writing this there was no word on when, or if, the company would receive approval.
So yes, there’s a path for growth. However, if you’re looking for NVAX stock to achieve 10-bagger status again, you’ll be disappointed. Right now, investors would be happy to get the stock back around the $270 level it was at in early September.
There’s a lot of noise with NVAX stock right now. And to be clear, it’s not all bad news. Like changeable weather, there’s a range of outcomes that are possible with Novavax. If you’re comfortable with that, then my last piece of advice is to keep your eyes open and your stop loss orders in place.
On the date of publication, Chris Markoch 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.
Chris Markoch is a freelance financial copywriter who has been covering the market for seven years. He has been writing for InvestorPlace since 2019.