It’s yet another down day in the markets right now, with most stocks feeling the pressure of bond yields which continue to creep higher. Accordingly, perhaps today’s decline in Novavax (NASDAQ:NVAX) stock isn’t surprising. Currently, NVAX stock is down a little more than 2%, about in line with where the market is.
However, what’s so concerning about this move in NVAX stock is that it comes on the heels of a massive positive catalyst for the company. Today, the U.S. Food and Drug Administration (FDA) announced it authorized Novavax’s Covid-19 vaccine as a booster shot for adults. This booster is recommended for individuals who received a previous shot of either the Pfizer (NYSE:PFE) or Moderna (NASDAQ:MRNA) vaccines but may benefit from a mix-and-match approach to vaccines. That’s because Novavax’s bossier shots use a protein platform, whereas Pfizer’s and Moderna’s vaccines use mRNA technology to deliver the payload.
Let’s dive into why NVAX stock is on the decline, despite this massive announcement.
Why Is NVAX Stock Sinking Today?
This is the announcement Novavax investors have been waiting for. Perhaps that’s the key driver for today’s indifferent price action with this vaccine stock.
While there’s still some demand for booster shots, expectations around growth in Covid-related stocks have taken a hit as the virus approaches an endemic state. Sure, folks are likely to get their annual flu/covid shots over time. But, the most profitable days are likely behind vaccine makers, as Covid-19 moves down on the list of worries for most individuals.
Thus, perhaps the window of opportunity isn’t closed just yet, but it’s closing fast. And given the market share lead of Pfizer and Moderna in this space, it’s unclear how many individuals will choose a “new” option, relative to the proven stalwarts having shown efficacy already.
That said, there is plenty of data showing that a lot of Americans, about 95% of those eligible, have yet to receive a booster dose. That’s a massive population in the U.S. alone. Accordingly, Novavax’s target market just increased considerably today. Thus, this is a stock that should be shooting higher.
It’s the fact that NVAX stock is stagnating that should worry investors. Right now, this is a stock I think investors need to be careful with.
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.
