Moderna Stock: A Buy for the Long Term?

Moderna (MRNA) has been a household name since the successful launch of its COVID-19 vaccine, Spikevax. However, the company's stock performance has been volatile, with analysts' ratings and price targets varying widely. As of January 2025, the average analyst rating for MRNA stock is "Hold," with a 12-month stock price forecast of $76.35, indicating a potential increase of 124.16% from the latest price. This article explores whether Moderna stock is a buy, considering its pipeline, market potential, and risks.



Moderna's Pipeline and Market Potential

Moderna's mRNA platform has demonstrated remarkable versatility, with five vaccine programs achieving positive Phase 3 results. The company's respiratory vaccine portfolio includes vaccines against influenza, respiratory syncytial virus (RSV), and human metapneumovirus (hMPV), while its latent and other vaccine portfolio targets viruses like Epstein-Barr virus (EBV), Varicella-Zoster virus (VZV), and norovirus. Additionally, Moderna is developing a combination vaccine against influenza and COVID-19, mRNA-1083, which recently announced positive results in its Phase 3 trial.

Moderna's mRNA platform has the potential to revolutionize the vaccine and therapeutics market, with applications in infectious diseases, immuno-oncology, rare diseases, autoimmune diseases, and cardiovascular diseases. The global mRNA market is expected to grow at a CAGR of 16.23% during the forecast period (2024 to 2032), driven by advancements in biotechnology and the expansion of mRNA applications beyond vaccines. This market growth can positively impact Moderna's long-term stock price.



Risks and Challenges

Despite its promising pipeline and market potential, Moderna faces several risks and challenges that could impact its stock price:

1. Revenue Forecast Cuts: In January 2025, Moderna cut its 2025 revenue forecast by $1 billion, which sent its stock plummeting by over 20%. This highlights the impact of revenue expectations on the stock price.
2. Analyst Ratings and Price Targets: The average analyst rating for Moderna stock is "Hold," with a wide range of price targets, from $38 to $139. This variation indicates differing levels of optimism among analysts.
3. Influenza Vaccine Pop: Mizuho Healthcare Sector strategist Jared Holz stated that Moderna is a "trade" on the Bird Flu vaccine pop, suggesting that the stock's performance could be tied to the success of its influenza vaccine programs.
4. Regulatory Approvals and Delays: The success of Moderna's pipeline depends on regulatory approvals, which can be unpredictable and time-consuming. Delays or rejections could negatively impact the stock price.
5. Competition: The mRNA market is competitive, with key players like BioNTech and Pfizer. As these companies and others advance their own mRNA technologies, they could pose a threat to Moderna's market share and stock price.
6. Pandemic Uncertainty: The ongoing COVID-19 pandemic and the emergence of new variants pose uncertainty for vaccine demand and Moderna's financial performance. Changes in public health policies and vaccine mandates could also impact the stock price.

Conclusion

Moderna's stock price is influenced by various factors, including its pipeline, market potential, and risks. While the company faces challenges and uncertainties, its mRNA platform's versatility and potential for growth make it an attractive long-term investment. Investors should closely monitor Moderna's progress, regulatory approvals, and market competition to assess the potential impact on its stock price. As of January 2025, with an average analyst price target of $76.35, Moderna stock may be an attractive buy for those with a long-term perspective.