Key Takeaways
- Moderna, the covid vaccine developer, is exploring a new use for its mRNA technology in cancer treatment
- Shares nearly tripled last week on the drug’s trial readout, and are up around 350% for the year
- The stock is at a two-year high, but remains at just a third of its covid-era peak
Moderna MRNA, the vaccine maker of pandemic-era fame, has surged back into the spotlight as investors weigh the results of a study in which its mRNA-based therapy proved effective against skin cancer.
The US biotech nearly tripled its share price in a single day last week, after reporting successful late-stage trial results for its experimental treatment.
The personalized mRNA vaccine, developed in partnership with Merck, not only suggests an oncological breakthrough for patients with melanoma. It also signals possible commercial value for mRNA technology beyond infectious diseases.
Even after paring gains slightly after the announcement, the stock is up 350% for the year. But can the rally be sustained, or even continue?
Can Moderna Develop a New Revenue Driver?
The breakthrough comes as Moderna has struggled to regain traction with investors following its Covid-era stock boom.
Moderna’s second-quarter revenues totaled $145 million. But net losses continue to outpace this at $782 million, with the company investing heavily in new drug candidates. Meanwhile, the firm has faced setbacks from other trials, including its norovirus vaccine.
Nevertheless, Morningstar director Karen Andersen says results from Moderna’s intismeran cancer drug offer “validation” for the potential of its mRNA technology beyond vaccines. And, while the specific type of cancer studied in the trial is relatively niche, it bodes well for ongoing intismeran studies on other cancers.
Is Moderna Stock a Buy Now?
Does that make Moderna stock a buy now, even after its steep rally?
Currently trading at $139 a share, Moderna stock is at a two-year high, but remains at just a third of its Covid-era peak.
Following last week’s trial readout, Morningstar raised its fair value estimate for Moderna to $163 from $79. But, with no moat and a still high uncertainty rating, the stock, for now, appears to be fairly valued.
