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Despite Setbacks, the Future Remains Bright for Novavax Stock

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Most of us aren’t waiting to put our pandemic year fully in the rearview mirror. But when it comes to Novavax (NASDAQ:NVAX), thriving is still very much all about Covid-19. Let’s take a look at what’s happening both on and off the price chart with NVAX stock.

Novavax (NVAX) logo surrounded by medical supplies
Novavax (NVAX) logo surrounded by medical supplies

Source: Ascannio/Shutterstock.com

Life is good, right? If you’re an American, where 41% of the population has been vaccinated and Moderna (NASDAQ:MRNA), Pfizer (NYSE:PFE) and Johnson & Johnson’s (NYSE:JNJ) vaccines are so plentiful that health regulators have offered to pay heel draggers prizes of up to $1 million dollars for getting the shot — yeah, it is.

For most of the world elsewhere around the globe, however, Covid-19 is still a significant problem with serious consequences. In recent weeks India has shattered infection records, and while things are getting better there, the fact remains just 10% of the world’s population is even partially vaccinated. Moreover, that number is significantly lower in under-developed countries.

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NVAX to the Rescue?

Novavax’s coronavirus drug candidate NVX-CoV2373 utilizes genetic materials that mimic Covid’s spike protein. And when combined with an immunoadjuvant to boost patients’ immune response, the vaccine has proven incredibly robust. Clinical studies have confirmed 96% efficacy against the original virus. It’s also shown success rates of 86% and 55% against U.K. and South African variants. Nice, right?

But NVAX has had its share of setbacks. The largest challenges have been production problems and getting through the regulatory process, standard struggles among smaller biotech firms. Still, that has left NVX-CoV2373 unable to achieve emergency usage authorization (yet).

Today, Novavax is highly unlikely to see its vaccine distributed in G7 nations. But all isn’t lost for NVAX stock.

There is hope for a greater tomorrow for all parties concerned (beyond those other parties already raging in more carefree hotspots). This past month, NVAX partnered with global vaccine alliance Gavi. The agreement is for Novavax to manufacture and distribute 350 million doses of its recombinant vaccine to developing countries.

Bottom-line, if the deal bears fruit and NVAX begins successfully vaccinating global populations still desperately in need, the outfit stands to see revenues swell into the billions by next year. Coupled with a NVAX valuation that’s been cut nearly two-thirds to about $13 billion, as well as life-saving cash on hand of around $2 billion, a third wave of success is looking increasingly likely on the price chart.

NVAX Stock Weekly Price Chart

Novavax (NVAX) weekly pivot low confirmed and potentially significant third bullish wave underway
Novavax (NVAX) weekly pivot low confirmed and potentially significant third bullish wave underway


Source: Charts by TradingView

To be clear, there’s still a lot resting on future victories when it comes to NVAX stock’s longevity. It needs to become a company that thrives, rather than reverting back to its threatened pre-Covid status pre-Covid. But conditions today appear quite promising on the price chart.

As the weekly price chart reveals, shares have retreated since early 2021 to test the trendline and 62% support. Furthermore and quite bullishly, the challenge has turned into a confirmed pivot low. Combined with a well-positioned stochastics setup, this price action could mark the beginning of a third wave to fresh all-time-highs for NVAX and its investors.

For those investors sympathetic to Novavax’s potentia,l I’d recommend the October $150/$290 collar. Given what’s happening off and on the price chart, this limited risk dynamic strategy is the best treatment for healthy gains and antiviral protection from the bear flu.

On the date of publication, Chris Tyler did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris Tyler is a former floor-based, derivatives market maker on the American and Pacific exchanges. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits.

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