Moderna Analyst Says Coronavirus Vaccine Candidate Has 65% Chance Of Success

Morgan Stanley, which recently named Moderna Inc MRNA as one of the likeliest candidates to succeed in the coronavirus vaccine race, reviewed the interim Phase 1 data released by the company Monday.

The Moderna Analyst

Matthew Harrison maintained an Overweight rating on Moderna shares and increased the price target from $37 to $90. 

The Moderna Thesis

Moderna's ability to scale coupled with promising early results positions it well to compete in the market, Harrison said in a Wednesday note. (See his track record here.)

The analyst expects Moderna to sell about 1.5 billion doses of the vaccine during the pandemic period and 150 million annual doses during the endemic period.

"Given the promising early results, we risk-adjust our estimates assuming a 65% probability of success, slightly higher than the ~56% of typical PhII vaccine candidates."  

Breaking down Morgan Stanley's valuation model, Harrison said $23 of the firm's price target increase is attributable to the coronavirus vaccine. $12 per share is assigned to year-end 2021 cash and lower dilution; $11 per share is attributed to the higher chance of success across the vaccine platform and $7 is for the increase in platform value, the analyst said. 

Morgan Stanley expects full Phase 1 data to be available by the time the Phase 3 study starts in July, and projects the Phase 2 data will be released in the fall of 2020.

Interim Phase 3 data is likely to be available as early as the end of the year, Harrison said. 

The analyst said he will continue to watch the manufacturing ramp of Moderna's vaccine candidate. Heexpects millions of doses in the fall, tens of millions per month by year-end 2020 and a $1-billion annual runrate by mid-2021.

MRNA Price Action

Moderna shares were trading 0.66% higher at $72.14 at the time of publication Wednesday. 

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