Can Moderna stock triple my money this year?

Shares of vaccine makers have fallen from grace since the Covid restrictions were lifted, and Modern (NASDAQ: MRNA) stock is no exception. However, one analyst has a $506 price target on the biotech stock, suggesting it could triple from current levels. Here I am.

Target cancer

mRNA technology only gained fame through its application in the Covid vaccine. But it is important to note, this is not the main function. In fact, their primary goal is to study and develop cancer treatments. And that is exactly what he has done in the end.

The company has collaborated with Merck to find a cure for skin cancer. Moderna shares surged as much as 30% after releasing its latest test results. The trial showed that patients with stage 3/4 melanoma reduced their risk of recurrence or death by 44% when they combined Moderna’s new cancer vaccine with Merck’s immunotherapy treatment. Keytruda.

This is the first breakthrough with mRNA technology on the cancer front, and presents an opportunity as the company plans to further study melanoma and other cancers.

However, it should be noted that these studies are still in their early stages. Discussions are being held with regulatory authorities with the hope of launching a Phase 3 study this year. If successful, this could send Moderna’s stock soaring beyond its all-time high. Analysts estimate that the treatment could generate about $1 billion in annual sales, and $5bn if its application extends beyond skin cancer.

A healthy relationship

Apart from the new vaccine, it is also encouraging to know that Moderna has been able to continue its strong relationships with large organizations and governments. This has been proven by the latest agreement with the British government. The group recently agreed to continue investing in Covid vaccine research and development, while building a new vaccine manufacturing facility in the UK.

The 10-year deal will produce 250m mRNA vaccines per year. These include shots for the flu and respiratory syncytial virus that are in the development pipeline.

A jab from Pfizer

Investing in Moderna stock also presents risks. The first is the ongoing legal battle Pfizer and BioNTech on the use of mRNA technology. The second is the conglomerate’s lack of revenue streams. Aside from the Covid vaccine, Moderna currently has no other products approved to generate revenue.

Thus, the 2022 sales forecast is in the range of $18bn to $19bn. This means no growth from the previous year. To make matters worse, analysts predict the company’s sales will drop by more than 50% this year as use of the Covid vaccine declines.

While the short to medium term remains uncertain, the future of cancer care is something I’m looking forward to. In the meantime, I can see Moderna’s strong balance sheet and another pipeline of vaccines coming in.

Therefore, with the multiples that are quite reasonable now, I recently chose to start a small position. The stock only has an average price target of $219, but I expect my money to grow 10-fold over the next decade. if it makes a breakthrough mRNA cancer vaccine.