TOPLINE Moderna shares plummeted Thursday morning after the Cambridge, Massachusetts-based biotech firm posted worse-than-expected quarterly earnings and warned sales of its Covid-19 vaccines would fail to meet previous projections, fueling pessimism among analysts that warning the stock’s meteoric gains would fail to hold up amid supply-chain constraints as the pandemic wanes.
KEY FACTS
Shares of Moderna plunged 17% shortly after the market opened Thursday, wiping out more than $24 billion in market value and pushing prices to a three-month low of $287.
Triggering the morning crash, Moderna on Thursday reported third-quarter sales and earnings that failed to meet analysts’ expectations, with revenue falling short of $5 billion despite average analyst projections calling for $6.2 billion.
In a conference call, Moderna CEO Stéphane Bancel blamed a “more complex” supply-chain environment for the disappointing performance, adding that longer delivery times for international shipments may shift some deliveries to early 2022, instead of 2021’s fourth quarter.
Moderna said it now expects to deliver between 700 million and 800 million Covid-19 vaccine doses this year, down from previous projections calling for between 800 million and 1 billion doses; sales should now fall between $15 billion and $18 billion, instead of the $20 billion originally projected, the company said.
KEY BACKGROUND
Covid-19 vaccines, which are Moderna’s only commercialized product, have proven to be highly effective in preventing serious illness and the market’s best defense against the virus—making them a massive boon to a slew of businesses heading up their development. However, Moderna shares have struggled in recent months as critics increasingly question whether or not sales of Covid-19 vaccines will prove a viable revenue stream in years to come. In August, Bank of America sparked one of the biggest selloffs in Moderna’s history after saying future sales expectations don’t justify the company’s current valuation. The analysts warned that lower-than-expected vaccine sales and more intense competition as Covid-19 research advances marked the biggest risks to Moderna stock prices.
SURPRISING FACT
Despite its recent weakness, Moderna is still the S&P’s best-performing component this year, with shares skyrocketing about 200% thanks to the company’s Covid-19 vaccine becoming widely available across the world. Still, shares have crashed nearly 40% from an all-time closing high of $484 on August 9.
BIG NUMBER
$9.5 billion. That’s how much Bancel, who joined Moderna in 2011, is worth as of 10:00 a.m. EDT Thursday, according to Forbes. The French native, who owns a roughly 8% stake in Moderna, has seen his fortune plunge by about $1.6 billion as a result of the stock’s rout on Thursday.
FURTHER READING
Moderna Crash Wipes Out $22 Billion In Value After Merck’s Covid Pill Triggers Vaccine Stock Plunge (Forbes)
By Jonathan Ponciano, Forbes Staff