To The Moon

$Moderna, Inc.(MRNA)$ is scheduled to report fourth-quarter and full-year 2024 earnings on 14 Feb before the opening bell.

While a major portion of Moderna revenues is expected to be generated from the sales of its COVID-19 vaccine, but we need to understand that we are already into matured phase of the post-pandemic, and the vaccine sales would likely declined from one year ago level due to the lower demand.

Based on what Moderna has provided in the preliminary updates last month, MRNA has likely recorded minimal product sales of its RSV vaccine mResvia, which received FDA approval in May.

The revenue consensus is set to expect at $955.23 million, this represent a significant decline from one year ago period metric, that is also reflected in its earnings per share which is expected to come in at a loss of $2.65 per share.

Moderna (MRNA) Last Neutral Earnings Call Have Seen A Loss Of -41.06% Change Since

Since the MRNA last earnings call on 07 Nov 2024 which has a neutral sentiment, MRNA share price has lost 41.06% since, the earnings call presented a mix of positive developments in revenue growth, cost reduction, and pipeline progress.

However, challenges remain in RSV sales, international market performance, and competitive pressures in the COVID vaccine market.

Moderna (MRNA) Guidance On Plan To Improve COVID-19 vaccination rates

During Moderna's Q3 2024 earnings call, the company provided detailed financial guidance and updates on their operational strategy. They reported a revenue of $1.9 billion for the quarter, with a net income of $13 million, and ended with cash and investments totaling $9.2 billion. Moderna highlighted significant cost-saving measures, having reduced operating expenses by $500 million compared to the first quarter of 2024. They maintained their full-year product sales estimate of $3 billion to $3.5 billion, with an anticipated Q4 sales range of $0.8 billion to $1.3 billion.

Additionally, Moderna's market share for COVID vaccines in the U.S. retail sector was approximately 40%, and they have been actively working to capture larger market shares in other sectors. The company also discussed its focus on long-term growth through a robust pipeline, aiming for up to 10 product approvals over the next three years, and emphasized ongoing efforts to improve COVID-19 vaccination rates through health care provider education and consumer campaigns.

I foresee some challenges for MRNA as the current administration would not be so keen in improving the COVID-19 vaccination rates especially so when the President priority is to look at area where cost cutting might be possible, so I would see MRNA face with a significant in U.S. For the international market, most of the developed countries have completed most of the vaccination for their residents (the basic requirement), so the optional to have the vaccination once it expire would need to see how MRNA promote it.

Moderna (MRNA) COVID Vaccine Market Challenges And Lower RSV Sales A Concern

In the third-quarter, Moderna delivered $1.9 billion of revenue in Q3 2024. They reduced operating expenses by $500 million compared to Q1 2024, excluding a $1.4 billion resizing charge. Net income improved to $13 million from a loss of $3.6 billion in Q3 2023.

We have also see Moderna achieved a 40% share of retail COVID vaccine doses in the U.S. and experienced an earlier launch for the 2024-2025 season that exceeded expectations. And Moderna reported positive Phase III data for its next-generation COVID vaccine, RSV vaccine, and combination flu-COVID vaccine. Plans to file for approval in 2024 for these products.

But we need to understand that as more and more countries have also stocked up the COVID vaccine and the basic vaccination regime have been completed, we might see the decline in RSV sales as seen in Q3 2024, where RSV vaccine sales were $10 million in Q3 2024, below expectations due to timing of approval and inventory buildup by competitors.

Similarly, we would be seeing a decline in international sales as fulfillment of deferred orders in the previous year. 2025 might also see a slower demand.

Plus uncertainty in the U.S. COVID vaccine market with potential sales decline in Q4 2024 and competitive dynamics affecting market share.

Moderna reported positive Phase III data for its next-generation COVID vaccine, RSV vaccine, and combination flu-COVID vaccine. Plans to file for approval in 2024 for these products. We will need to see how these products would be received by the market.

Moderna (MRNA) Price Target

Based on 16 Wall Street analysts offering 12 month price targets for Moderna in the last 3 months. The average price target is $48.50 with a high forecast of $96.00 and a low forecast of $33.00. The average price target represents a 58.83% change from the last price of $30.54.

I am expecting a further decline in MRNA share price because there is not much plan on how they are going to market the next-generation COVID vaccine, RSV vaccine, and combination flu-COVID vaccine.

Technical Analysis - Exponential Moving Average (EMA)

Looking at the technical, I would think MRNA might continue its downtrend as there is not much signal giving a potential of a reversal to the upside.

From the RSI we are seeing a possible selloff, as it is moving near the oversold and from the EMA, it is currently trading far from the 12-EMA, there is no signs of attempt to make any daily uptrend move.

So I am thinking of putting a puts to take advantage of the downtrend.

Summary

I think MRNA might suffer a selloff if the results came in lower-than-expected, it could be below the expectations than Q3, as the demand for COVID Vaccine in 2024 should be much lower as the orders from previous are being consumed.

I would be taking a short position on MRNA by trying on the options side.

Appreciate if you could share your thoughts in the comment section whether you think MRNA could be heading to a selloff if their sales from COVID vaccine were to decline more.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.