On Thursday, Deutsche Bank (ETR:DBKGn) revised its price target for Moderna (NASDAQ:MRNA) shares, increasing it to $85 from the previous $70, while maintaining a Sell rating on the stock. The adjustment follows a review of Moderna's first-quarter performance, which reported steady revenues and unchanged full-year guidance.
Moderna's first-quarter results, released on May 2, 2024, showed little change in the company's financial outlook, with forecasts for a cash burn of over $3 billion and a year-end net cash position of approximately $9 billion remaining intact. Despite these consistent projections, Deutsche Bank's analyst pointed to the unlikelihood of a significant uptick in U.S. COVID-19 vaccination rates during the upcoming winter season, citing Moderna's own estimates of an 11% vaccination rate in the fall of 2023, compared to a 44% rate for the flu vaccine.
The bank acknowledges Moderna's clinical advancements, particularly in pneumococcal conjugate vaccines (PCV) and respiratory syncytial virus (RSV), but maintains a cautious stance. The analyst suggests that key developments expected in the second half of 2024, including the commercial launch of an RSV vaccine and Phase 3 updates for the COVID-19 and flu, as well as cytomegalovirus (CMV) vaccines, could be pivotal for the company's performance.
Deutsche Bank's revised price target reflects a 21% increase and aligns with an updated net present value (NPV) calculation following the first-quarter assessment. The bank remains watchful, anticipating the forthcoming clinical updates as potential influencers on Moderna's stock trajectory for the remainder of the year.
InvestingPro Insights
Recent data from InvestingPro showcases a mixed financial landscape for Moderna. With a market capitalization of $47.64 billion, the company's aggressive share buyback strategy, as highlighted by one of the InvestingPro Tips, indicates management's confidence in the company's value. Despite a significant revenue decline over the last twelve months, Moderna's stock has experienced a substantial price uptick, with a 75.36% total return over the past six months and a 22.56% year-to-date price total return.
The balance sheet remains robust, with another InvestingPro Tip pointing out that Moderna holds more cash than debt, positioning it well for future investments or to weather economic downturns. Additionally, 11 analysts have revised their earnings upwards for the upcoming period, suggesting potential optimism in the company's future performance. It's worth noting that analysts are not anticipating profitability this year, and they expect a sales decline in the current year, which may be a concern for potential investors.
For those looking to delve deeper into Moderna's financials and future prospects, InvestingPro offers more tips and a comprehensive analysis. Readers can discover additional insights and utilize the coupon code PRONEWS24 to get an extra 10% off a yearly or biyearly Pro and Pro+ subscription. With 13 additional InvestingPro Tips available, investors can make more informed decisions based on the latest market data and expert analysis.
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