For months the world has been under the spell of the COVID-19 vaccine race, as society is very anxious to see which pharmaceutical company will be the first to complete its Phase 3 study. A live tracker has been published on the website of The New York Times to see which pharmaceuticals are in which phase. It can be seen that Novavax ($NVAX) is starting to lag behind at the moment. On August 24, the company began their Phase 2 studies. Around 1,500 participants are taking part in this clinical study, which tests the safety and immunogenicity of the vaccine candidate. What are the analysts and experts saying today about the current situation of Novavax?
And expert advice based on the figures
At $6.12, Novavax is now -29.98% off the past 50-day moving average (GD50). The short-term assessment has thus been determined on a sell rating. Who looks at the past 200 days (GD200) will stick to the same rating and values the share as a sell, as the distance to the GD200 is -78.27%. From a technical chart point of view, the share is rated as a sell for both periods.
An important signal from the technical analysis – known as the Relative Strength Index (RSI) – concerns the upward and downward movements of prices over a 7-day period. Three rating are being used with this index. The first rating is oversold when the value is between 0 and 30, a neutral rating is given when the value is between 30 and 70 and the share gets an over-bought rating when the value is between 70 and 100. The RSI of Novavax has a level of 37.59, which means it is in the neutral sector and therefore receives a hold rating. The RSI25 – based on a 25 day period – currently stands at 73.05 which is an indicator of a sales rating. The two valuations together led to a sales rating as a final verdict.
Why shareholders remain positive
Despite the hard numbers advising a sale, shareholders on social media are generally positive about Novavax. They still seem optimistic and in good moods. In most cases they refer to a general purchase assessment. Shareholders don’t seem to just look for which pharmaceutical companies are at the forefront of the vaccine race. They believe in the potential of vaccine candidate NVX-CoV2373 and the agreements that Novavax has concluded with various governments (US, Canada, UK & Rep. South Korea). Enthusiasm intensified when the US government awarded $1.6 billion to Novavax as part of “Operation Warp Speed” to advance the production of NVX-CoV2373 that should result in the production of 100 million doses. This offers the necessary potential, because experts agree that the vaccine race will not have a “winner takes all” principle. Interim data about the vaccine candidate are expected in the fourth quarter of this year.
The determining factor will be whether the vaccine candidate meets the expectations of the authorities. Critics suggest that early vaccine data from the NVX-CoV2373 scored highest in efficacy. This while the front runners who are close to the finish line do not always seem to have equally strong numbers. Also several pharmacists deal with complications during the Phase 3 studies.
In addition, current share prices play a significant role in the catalyst that changes the game. When expectations result into disappointment, the share will shoot down. Several analysts believe this is unlikely to happen, as the company also relies on the NanoFlu catalyst, a recombinant quadrivalent influenza vaccine candidate that has been granted fast track status by the FDA, and met all primary endpoints in a Phase 3 trial. This could minimize the harm to Novavax if the results of the vaccine candidate are disappointing. It should be noted, that while shares may fall to pre-pandemic levels, it can still result in significant losses for shareholders adding the NVAX-share to their portfolio today.
Furthermore, an expert wrote that it doesn’t matter who will win the US presidential election. More investments for vaccine studies and the purchase of millions of doses is a certainty. That could mean a much higher potential turnover for the vaccine candidate NVX-CoV2373 later this year.
The Wisdom of Wall Street
Most of the experts on Wall Street seem to agree on the current situation of the NVAX-share. For those who are in possession of the share, a hold rating is advised. In addition to the figures, analysts also speak of various uncertainties that first require clarification before more of the share has to be purchased. For those who plan to invest in the share either way, it is strongly recommended to wait a bit more until the price has fallen further. This avoids an opportunity with a high risk and a high return character.
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