Novel coronavirus vaccine stocks, like Novavax (NASDAQ:NVAX) have been incredibly rewarding. When I first weighed in on the NVAX stock, in late February, it was trading at $15 a share. It’s now at $134 — a gain of 800% in just five months.
Over the same time frame, other vaccine companies have seen similar monster moves.
- BioNTech (NASDAQ:BNTX) ran from $32.85 to $90;
- Inovio Pharmaceuticals (NASDAQ:INO) ran from $4 to $25.33; and,
- Moderna (NASDAQ:MRNA) ran from $22 to $77.40
The best part — each still has incredible upside potential because we need a vaccine — now. As CNBC’s Jim Cramer wrote on July 24, “Our fate is in the hands of a few dozen companies with a dizzying array of clinical trials, and whoever gets there first is gonna make a fortune.”
Of those, however, Novavax is my pick. Even after that rocket ride, I believe it could still run to $200 a share with its big catalysts.
Catalyst No. 1: The Virus Isn’t Going Away Any Time Soon
At the moment (1o a.m. EDT, July 26), the global virus count is up to 16.1 million cases diagnosed with 645,192 deaths.
- The U.S. is up to nearly 4.2 million cases and recording up to 2,600 new virus cases every hour;
- Brazil is up to 2.39 million;
- India is up to 1.39 million;
- Russia is up to 811,073; and,
- South Africa is up to 434,200
Hospitals are overwhelmed. Many schools have decided to teach online in the fall. And some states could soon issue “stay at home” orders again. It’s a catastrophe out there. We won’t get back to normal until there’s a good vaccine.
Worse, according to Dr. Anthony Fauci:
“We are living, right now, through a historic pandemic outbreak. And, we are, right now, in a situation where we do not see any particular end in sight. It’s the perfect storm. We often talk about outbreaks and pandemics, be they influenza or other pathogens, that have to have a few characteristics that make them particularly formidable. Well, this particular virus has that.”
Catalyst No. 2: Test Results Expected this Month
Over the last few days, the Novavax said clinical trial results for its vaccine will include antibody and T-cell responses from its study on NVX-CoV2372 for COVID. With results expected still this month, NVAX stock could explode higher on positive findings.
Better, Novavax president of research & development, Dr. Gregory Glenn, said the company is being “very aggressive with its timeline” and is trying to get the vaccine ready by the end of 2020, according to the The Baltimore Sun.
“The Operation Warp Speed contract calls for us to deliver 100 million doses to the U.S. I think we see ourselves to be on track for that. Obviously, that’s a very challenging task,” Glenn said. “We have completed a Phase 1 trial. We’re about to ‘unblind’ data at the end of July, so that’s shortly.”
Catalyst No. 3: Analysts are Encouraged by Vaccine Candidate
Cantor Fitzgerald analyst Charles Duncan is among those confident in the potential vaccine, reiterating an overweight rating with a $148 price target. He’s reportedly encouraged by the pre-clinical data already released by the company.
“The key new information, according to the analyst, was that cynomolgus macaques — a non-human primate — vaccinated with NVXCoV2373 and challenged with live virus showed lower levels of detectable viral loads in bronchoalveolar lavage samples compared to placebo animals,” as reported by Benzinga contributor Shanthi Rexaline.
Bottom Line on NVAX Stock
While I strongly believe that NVAX stock could race higher, we have to play this one safe.
After all, the shares are sensitive to news, as are most of the big players. My best advice if you’re in this to trade is to set a trailing stop loss to safeguard any wins you have to date. That way, if study data news is disappointing, you’ll be able to protect your win.
If the company is successful, and we see the NVAX stock run higher, your trailing stop won’t be triggered and you can enjoy further upside. Then again, you’d also have to look out for a sell-the-news reaction, so it’s best to have that stop in place for security.
Ian Cooper, an InvestorPlace.com contributor, has been analyzing stocks and options for web-based advisories since 1999. As of this writing, Ian Cooper did not hold a position in any of the aforementioned securities.
