Moderna’s vaccine is about to get a boost. His inventory is taking a hit.

Moderna's vaccine is about to get a boost.  His inventory is taking a hit.

A Moderna sign is displayed on a shelf during clinical trials for a Covid-19 vaccine. Eva Marie Uzcategui / Bloomberg

Moderna is set to provide Americans with the second vaccine against Covid-19, after the company’s shots were approved on Thursday by a group of expert advisers from the U.S. Food and Drug Administration. The FDA is likely to grant emergency use authorization for the vaccine within a day – as it did after the Dec. 10 advisory vote in favor of the Pfizer and BioNTech vaccine.

Investors sold on the good news. On Friday morning, Moderna stock (ticker: MRNA) opened down 3% to $ 139.

The vaccine is reportedly the first product Moderna ships, and its sales could generate more than $ 8 billion in revenue next year. But even after the stock pulled off from the all-time high of $ 178.50 reached on Dec. 1, the market now values ​​the biotech company at over $ 55 billion.

This reasonably explains all the revenue Moderna can expect from the Covid-19 vaccine and other products in its pipeline, Morgan Stanley’s Matthew Harrison said in a Wednesday memo lowering his rating on the stock from Overweight to Equal Weight. He thinks Moderna’s outlook would be fairly valued at its target price of $ 150 a share.

Morgan Stanley’s advice to take profits on Moderna’s triumph aligns with other brokers who have moved on the sidelines. Analysts from BMO Capital Markets, Jefferies and Needham recently revised lower.

Downgrades also followed FDA clearance on December 11 of the country’s first Covid vaccine from Pfizer (PFE) and BioNTech (BNTX), with RBC Capital Markets moving to a suspension of Pfizer. The inventor of Pfizer’s vaccine, BioNTech, reached a market cap of $ 25 billion. HC Wainwright analyst Robert Burns reiterated his neutral rating on BioNTech in an update Friday. He noted the start of pivotal clinical trials for a Covid vaccine by another rival, CureVac (CVAC), which pursues a variant of the messenger RNA approach used by BioNTech and Moderna.

On Friday morning, Pfizer stock fell 0.6% to $ 37.80, while BioNTech traded 1% to $ 105.

At Morgan Stanley, analyst Harrison believes the future of Moderna is bright. Movements in the stock over the next year will likely be dominated by sales and sales expectations for the Covid-19 vaccine, which Harrison expects to provide $ 10 billion to $ 20 billion in cash for the development of Moderna of cancer treatments and other vaccines that use its messenger. RNA technology.

However, sales of Moderna’s Covid vaccine will face competition and reduced need after 2021, Harrison warns. The recent share price does appreciate the company’s Covid opportunity, he concludes. He therefore passed away with his decommissioning.

Write to Bill Alpert at william.alpert@barrons.com