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Novavax: More Catalysts on the Horizon

The Covid-19 landscape is constantly evolving, but recent times have seen mixed blessings for coronavirus stocks. Pfizer has shown it is increasingly dominant in the Covid-19 vaccine space while the stock got an additional boost from the prospect of bringing to market a Covid-19 pill which could significantly reduce high-risk patients’ hospitalizations and deaths.

At the opposite end of the scale, both developments have been bad news for Moderna, whose Covid-19 vaccine is losing market share to Pfizer/BioNTech’s offering while the Covid pill could spell further pressure to an already disappointing revised 2021 outlook.

So where does this leave perennial outsider Novavax (NVAX)? Last week’s market performance had both the highs and the lows, as the stock also fell due to Moderna’s, and its own, earnings misses and the Pfizer pill news.

However, the company preceded those events with some promising developments. At long last, Novavax obtained its first EUA, after getting a nod of approval from the regulatory body in Indonesia. The company has now also completed full data submissions for emergency use authorization (EUA) with 9 regulatory bodies across the globe. Most notably, says B. Riley analyst Mayank Mamtani, these include the filing for an Emergency Use Listing (EUL) with the WHO, which will enable “potent distribution and adoption of NVX-CoV2373.” These developments should not be overlooked, says Mamtani.

“The access of '2373 to several regions of the world, with either low vaccination rates or those having received less effective C-19 vaccines, remains a critical element of the global toolbox deployed in fight against pandemic, including curbing unfettered spread of existing and emerging variants of concern/interest (VOC/VOI),” the analyst explained.

The company’s strategic partnership with the Serum Institute of India (SII) is also key and has helped to “advance analytical validation of large-scale '2373 batches produced.” It has also given a boost to production capacity which will help NVAX reach its manufacturing goals. Furthermore, SII's plant in Pune, India, was recently inspected by officials from the UK's MHRA and was granted GMP (good manufacturing practice) status.

“We believe this de-risks the pending review of UK's regulatory package, which also serves as reference filing for additional packages completed with European Medicines Agency (EMA) and regulatory agencies in Australia, Canada and New Zealand,” Mamtani opined. Additionally, EUAs are anticipated in the near-term in India and the Philippines.

Accordingly, Mamtani reiterated a Buy rating for NVAX stock backed by a $305 price target. Investors are looking at one-year returns of 92% from current levels. (To watch Mamtani’s track record, click here)

Overall, NVAX has a Moderate Buy consensus rating – and it is based on 2 Buys and 1 Hold given in the past 3 months. The shares have an average price target of $259, suggesting ~50% upside from current levels. (See Novavax stock analysis on TipRanks)

To find good ideas for covid-related stocks, 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.