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Moderna: Latest Data Confirms mRNA-1273 Is Best-in-Class

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Coronavirus stocks played a massive part in the stock market’s 2020 narrative. However, in 2021, so far, Moderna (MRNA) has continued last year’s performance. Shares are already up 66% this month, as Moderna keeps hitting all the right notes.

This week provided another catalyst for share appreciation. The biotech disclosed that its Covid-19 vaccine mRNA-1273 has showed it can be effective at fending off the new variants of SARS-CoV-2, which appear to be more contagious.

In a collaborative study with the Vaccine Research Center (VRC) at the National Institute of Allergy and Infectious Diseases (NIAID), mRNA-1273 proved effective against all the strains tested, including those that have emerged in the U.K. and South Africa. The latter variant, however, caused a sixfold reduction to neutralizing antibody (nAb) titers, although the nAb level was still higher than the required protective threshold. As a result, Moderna said it will test whether additional protection against the variant could be provided by a third booster dose of its vaccine, instead of the two-dose regimen required so far. The company plans to initiate a preclinical study and phase 1 trial in the U.S. for the booster vaccine candidate, named mRNA-1273.351.

For Oppenheimer analyst Hartaj Singh, the latest development only reaffirms the bullish case for Moderna.

“We continue to appreciate MRNA's transparency, the mRNA-based platform's flexibility tackling new viral strains/viruses, and management's execution to keep MRNA's leadership in the COVID-19 vaccine space,” the 5-star analyst said. “In addition, we believe today's update by MRNA denoted that COVID-19 continues to be a challenge, and the mRNA-1273's data has further strengthened MRNA's competitive advantage, stretching our ‘best-in-class’ thesis on mRNA-1273.”

There’s no change to Singh’s rating which stays an Outperform (i.e. Buy). But the analyst might as well have said Hold — because he thinks the stock, currently at $173.16, has only 3% upside, as indicated by his $178 price target. (To watch Singh’s track record, click here)

Indeed, according to Singh’s colleagues the upside is capped for now. In fact, at $147.85, the Street’s average price target implies shares will drop 14% from current levels. Nevertheless, the stock currently has a Moderate Buy consensus rating, based on 7 Buys and Holds, each, and 2 Sells. (See MRNA stock analysis on TipRanks)

To find good ideas for healthcare stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.