MRNA - Moderna: Really Strong Competition

2024-06-30 05:15:50 ET

Summary

• Moderna's success with COVID-19 vaccine approval under Operation Warp Speed led to a temporary revenue surge, but future sales may be limited due to politicization of vaccines and competition.
• Moderna's vaccine pipeline faces intense competition from established pharmaceutical companies, making it challenging for the company to maintain growth and profitability.
• Moderna's current valuation is significantly higher than the sector median, suggesting investors may be overestimating the company's future prospects, leading to a strong sell.

Investment Thesis

While Moderna ( MRNA ) was a pioneer in the development of COVID-19 vaccines, I think their long-term prospects as an investment appear less promising. The company's innovative mRNA technology allowed them to rapidly develop a highly effective vaccine during the pandemic, the competitive moat of their success is questionable in my opinion.

The pharmaceutical approval process for Moderna's COVID-19 vaccine was unique and unlikely to be replicated in the future. The urgency of the pandemic led to an accelerated development and approval timeline through “Operation Warp Speed” , which caused sales to skyrocket temporarily. This approval timeline only applied to COVID-19 vaccines, so without this “Operation Warp Speed,” Moderna has not commercialized any vaccines since that have mirrored the same level of success. Therefore, as the pandemic subsides and competition in the vaccine market intensifies, Moderna's revenue has cratered, and the company is now losing money and faces declining revenue for this year and next year....

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