Can Moderna’s share price keep climbing higher after Q3 earnings?

Moderna [MRNA] is forecast to reveal stellar revenue and earnings growth when it reports its third-quarter earnings on 4 November.

Analysts at Zacks expect Moderna to post earnings per share of $9.01 in its third quarter, which would mark an incredible 1,627.1% increase on the same period last year. Revenues are expected to come in at $6.09bn, up 3757.8%.

This follows what Moderna chief executive officer Stéphane Bancel called “a new growth phase” in the second quarter, as the biotech group’s share price was boosted by the successful development and rollout of its mRNA COVID-19 vaccine.

According to the Motley Fool, Moderna is expected to hit $20bn in sales of its COVID-19 vaccine this year, and recently sealed a deal with Peru to supply 20 million doses in the first quarter next year.

Post-pandemic caution

Over the last 12 months, its share price has surged by 411%, compared with Pfizer [PFE], which is up 30% and AstraZeneca [AZN] 24% higher, as at the 29 October close. At the 29 October close, Moderna’s share price stood at $345.21 — more than three times its price of $111.73 at the start of the year.

However, some analysts are sceptical as to whether this growth will continue, citing a less-than-stellar uptake of booster jabs in the UK and uncertainty over pricing in and supply to less-developed countries.

Some analysts are cautious about future demand as the pandemic begins to fade, as well as Moderna’s sky-high valuation of $140bn.

Deutsche Bank has a ‘sell’ rating and $250 target on the firm because, as reported by CNBC, potential innovation is already priced into Moderna’s stock. “There is potential to disrupt dynamics in the broader viral infectious disease arena (e.g., flu) but all that looks more than generously reflected in a valuation that looks detached from a problematic assessment of reality.”

According to Market Screener, most other analysts are equally as cautious. They have a consensus rating of ‘hold’ and a $296.20 target price.

However, Piper Sandler analyst Edward Tenthoff recently shifted Moderna from ‘neutral’ to ‘overweight’ and kept a $445 price target. The recent share price fall has made the company’s valuation look attractive, Tenthoff argues.

‘A historic moment’ in Q2

In the second quarter, Moderna’s revenues rocketed to $66.4m, far above the $13.1m level it reached in the same period last year and above the $27.4m forecasts.

It also posted a loss of $116.7m, compared with a $134.9m loss in the same quarter in 2020.

“The second quarter marked a new growth phase for Moderna as we started to build our commercial team, a historic moment for those of us who have worked at the company for many years since it was a breakthrough research enterprise,” Moderna CEO Bancel said.

Looking for innovation

Analysts will be looking for commentary on vaccine and booster shot sales expectations for 2022.

Most analysts don’t expect Moderna to get near its vaccine revenues for 2021 in 2022 but one recent study from Airfinity, according to a report in the Motley Fool, forecasts gigantic sales of $38.7bn.

Moderna expects to make between 2 and 3 billion doses of its vaccine in 2022 with plans to build a new manufacturing site with an estimated annual output of 500 million doses somewhere in Africa, reported The Motley Fool. Analysts will be looking for more clarity on this and whether the global supply chain squeezes could be a problem as well going forward.

Moderna has announced that it has products in the pipeline such as a flu vaccine and, excitingly, a personalised cancer vaccine, both of which could also lead to a run in the Moderna share price.