Pfizer, BioNTech and Moderna are experiencing a post-vaccine hangover on Wall Street this year.
All three stocks have surged dramatically in 2021, largely on the success and strong sales of their Covid-19 vaccines. But 2022 hasn’t been so kind to them. Shares of Pfizer (PFE) fell about 15%, while its vaccine partner Comirnaty BioNTech (BNTX) fell 35%. Moderna (MRNA) did even worse, plunging more than 40%.
Which give? Sales of Covid vaccines are not the problem. Pfizer said it expects Comirnaty’s revenue to hit $32 billion in 2022, while Moderna predicts it could generate nearly $20 billion in revenue from its coronavirus shot this year. (Pfizer and BioNtech split the gross profits from the vaccine.)
Part of the reason for the stock plunge may simply be that investors were already anticipating strong demand and did what traders do best: buy the rumor and sell the news. Pfizer’s stock soared more than 60% last year. BioNTech jumped more than 215% in 2021 while shares of Moderna rose nearly 145%.
Going forward, however, there may still be other vaccine-related upsides, especially for Pfizer and BioNTech stocks. Health regulators in the United States approved booster doses of the Pfizer/BioNTech vaccine for children ages 5 to 11 earlier this week.
Pfizer could also get an extra boost from Covid treatments thanks to its Paxlovid antiviral pill, which was approved late last year. Pfizer said it expects $22 billion in revenue from Paxlovid this year.
Pfizer is perhaps the best positioned of the three vaccine makers to thrive beyond Covid. The company has recently been on a takeover spree, recently announcing plans to acquire migraine drug maker Biohaven (BHVN) for nearly $12 billion earlier this month.
“The deal is a good use of cash for Pfizer, taking advantage of its large war chest to diversify into an approved drug that is taking market share and could significantly increase revenue,” the analyst said. of CFRA Research Stewart Glickman in a report following the Biohaven News.
The acquisition follows a nearly $7 billion deal late last year to buy Arena Pharmaceuticals, a company developing drugs to treat immune-inflammatory diseases. Pfizer also acquired cancer drugmaker Trillium Therapeutics last year for more than $2 billion. And even after all those deals, the company still has about $24 billion in cash on its balance sheet.
Pfizer’s diversification is a key reason analysts expect the company’s revenue to grow nearly 30% this year and earnings per share to increase more than 50%.
On the other hand, Moderna, which is not as diverse as Pfizer, needs to find another big blockbuster. Nearly 97% of the company’s first-quarter sales came from its Covid vaccine. Moderna’s sales are expected to rise about 20% this year, but analysts expect earnings to decline.
CEO Stephane Bancel said on Moderna’s latest earnings call with analysts earlier this month that two of the company’s main goals were to “expand beyond infectious disease vaccines into therapeutics.” and find merger candidates. Moderna is also working on vaccines against other viruses, such as HIV and Epstein-Barr.
But the company has also recently suffered from a major PR blunder. Moderna’s newly hired CFO has been forced to resign after days on the job following disclosure of financial irregularities that are being investigated at his former employer Dentsply Sirona (XRAY), a machinery manufacturer x-ray and other dental equipment.
BioNTech, like Moderna, is also a bit of a one-trick pony right now in that nearly all of its Q1 revenue came from Comirnaty. Pfizer generated only about half of its sales from the vaccine in the first quarter.