2024-07-26 16:00:13 ET
Summary
- Novavax's Q1 2024 earnings were so-so, but a major partnership with Sanofi sent its share price soaring by 200%.
- The Sanofi deal provides essential funding but restricts Novavax's future earning potential, making it reliant on revenue streams from Sanofi.
- Novavax's long-term prospects may be challenging as it may struggle to develop new products and could see its revenue streams dry up post-2025.
- In this review ahead of Q2 earnings (to be announced on August 6) I take a deeper look at the Sanofi deal, and what to expect from Q2 earnings.
Investment Overview
I last provided coverage of Novavax ( NVAX ) - the Gaithersburg, Maryland based developer of "innovative vaccines to prevent serious infectious diseases", ahead of the company's Q1 2024 earnings in early May.
Frankly, I was not especially optimistic about the company's prospects, although I did not rule out a surprise - I wrote as follows:
The days of wild share price fluctuations and spikes >$100 per share are a long way behind Novavax now - a spike into the double digits would frankly be surprising in the current climate, as management wrestles with financial problems, announcing plans to let go ~30% of staff when announcing its 2023 earnings.
With that said, Novavax does have an effective, approvable vaccine product that may be capable of driving "blockbuster" revenues for many years to come, if a long-term private COVID vaccination market emerges, as many believe it will.
As such, Novavax retains the ability to surprise the market, as nobody quite knows what to expect from the company, or how its target market may develop over the coming years.
Read the full article on Seeking Alpha
For further details see:
Novavax Ahead Of Q2 Earnings - Picking Apart The Sanofi Deal