Following the rapid vaccination drives across the world last year, the demand for Covid-19 vaccines is declining. However, booster doses targeting new subvariants are expected to drive sales for coronavirus stocks in the days ahead.
Recently, the U.S. Food and Drug Administration (FDA) advised Covid-19 vaccine makers to update their booster shots, scheduled for this fall, to include components that could combat the currently dominant Omicron BA.4 and BA.5 subvariants. Given the uncertainty associated with Covid-19, it is difficult to determine the demand for vaccines in 2023 and the year ahead.
Coronavirus Stocks: Pfizer (PFE)
Pfizer’s (NYSE:PFE) Fiscal 2022 guidance indicates that the biopharmaceutical giant’s revenue could cross the $100 billion mark, thanks to the Pfizer-BioNTech Covid-19 vaccine, Comirnaty, and oral antiviral pill, Paxlovid. The company expects Comirnaty and Paxlovid to generate revenue of nearly $32 billion and $22 billion, respectively, in fiscal-year 2022.
With the Covid-19 portfolio eventually expected to lose momentum, Pfizer continues to strengthen its portfolio through organic growth and strategic acquisitions. As of early May, Pfizer’s pipeline comprised 96 programs in different stages of clinical development.
Pfizer’s $6.7 billion acquisition of Arena Pharmaceuticals gives it exposure to a strong pipeline focused on immunology drugs. The company recently announced an $11.6 billion deal to acquire migraine drug maker Biohaven Pharmaceutical Holding Company (NYSE:BHVN). Overall, Covid-19 products have significantly enhanced Pfizer’s cash position, enabling the company to make investments to ensure future growth.
Ahead of the upcoming second-quarter results, Morgan Stanley (NYSE:MS) analyst Terence Flynn cut his price target for Pfizer stock to $49 from $52 and maintained a “hold” rating after adjusting his estimates. Flynn expects biopharma revenues to remain resilient in case of an economic slowdown. He also believes that those companies that can generate revenue growth in the second half of the decade are best positioned among the biopharma group.
Overall, Wall Street analysts are cautiously optimistic on Pfizer stock, with a “moderate buy” consensus rating based on five “buys” and eight “holds.” At $57.08, the average Pfizer price target implies 6.7% upside potential from current levels.
Moderna’s (NASDAQ:MRNA) mRNA-1273 Covid-19 vaccine, branded as Spikevax, witnessed huge success and changed the company’s fortunes. The company expects $21 billion in Covid-19 vaccine sales this year.
Sitting on a pile of cash, Moderna is well-positioned to invest in future growth by expanding the applications of mRNA technology. Back in May, the company stated that it has 46 development programs in its pipeline. Moderna is optimistic that beginning the fall of 2022, its Phase 3 pipeline could result in three respiratory vaccine commercial launches over the next two to three years.
Recently, Morgan Stanley analyst Matthew Harrison reiterated a “hold” rating on Moderna stock with a price target of $199, following a thorough study of the rare diseases landscape. The analyst expects Moderna to present initial data in rare diseases propionic acidemia and methylmalonic acidemia in 2022.
Harrison added, “Initial proof of concept could unlock a broader rare disease pipeline because mgmt. can easily replace one mRNA with a new mRNA to target a new disease. While we expect initial data to be directional, we believe rare diseases could be an underappreciated long-term pipeline driver for Moderna.”
All in all, Moderna scores a “moderate buy” consensus rating based on five “buys,” five “holds,” and one “sell” rating. The average Moderna price target of $221 implies 23.12% upside potential from current levels.
Coronavirus Stocks: Novavax (NVAX)
Novavax’s (NASDAQ:NVAX) protein-based Covid-19 vaccine NVX-CoV2373, known as Nuvaxovid, is authorized for individuals aged 18 and more in the European Union and certain other countries. Earlier this month, the European Commission conditionally authorized Nuvaxovid for adolescents aged 12 through 17.
However, Novavax is still waiting for the U.S. FDA’s Emergency Use Authorization. Last month, the FDA Vaccines and Related Biological Products Advisory Committee voted in favor of Novavax’s Covid-19 vaccine.
Following the FDA’s Advisory Committee’s vote, B. Riley (NASDAQ:RILY) analyst Mayank Mamtani reiterated a “buy” rating on NVAX stock with a price target of $181. Mamtani believes that the FDA panel’s discussion “sets up the path for steady adoption initially with vaccine-hesitant but more importantly being part of the fall immunization (booster) campaign among a broad population.”
Further, Mamtani feels that the FDA could position NVX-CoV2373 as a front line vaccine to be used as an alternative to mRNA vaccines.
Overall, Wall Street has a “moderate buy” consensus rating on Moderna stock that breaks down into seven “buys,” one “hold,” and one “sell.” The average Novavax price target of $138 suggests 93.96% upside potential from current levels.
While Pfizer and Moderna’s vaccines have been leading the Covid-19 vaccine market, Novavax has been a latecomer. Wall Street analysts are treading cautiously with regard to all three stocks as the demand for Covid-19 vaccines is expected to moderate in the times ahead.
That said, analysts currently see a higher upside potential in Novavax stock following a significant pullback. In addition to its Covid-19 vaccine, Novavax is also working on a Covid-seasonal influenza combination vaccine candidate in a Phase 1/2 clinical trial. It is also working on other vaccines for malaria, Ebola, Middle East respiratory syndrome (MERS) and influenza.
On the date of publication, Sirisha Bhogaraju did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Sirisha Bhogaraju has over 15 years of experience in financial research. She has written in-depth research reports and covered companies across various sectors, with a primary focus on the consumer sector. Sirisha has a master’s degree in finance.