Moderna Stock Falls Amid Broad Sell-Off
Shares of Moderna are down by 7% today as higher Treasury yields put significant pressure on high-growth stocks.
There is a broad sell-off in the market, and S&P 500 is down by almost 2%. Moderna shares underperform as they have gained almost 300% year-to-date so traders are ready to take some profits off the table on any signs of broader weakness.
Recent comments from CEOs of Moderna and Pfizer, who stated that life may get back to normal in a year, may have put some additional pressure on the stock, although it looks that current weakness is mostly related to the sell-off in riskier assets which was triggered by higher Treasury yields.
What’s Next For Moderna Stock?
Analyst estimates for Moderna continued to move higher in recent weeks. Currently, analysts expect that Moderna will report earnings of $29.77 per share in 2021 and $26.97 per share in 2022, so the stock is trading at 14 forward P/E. It should be noted that the gap between 2021 estimates and 2022 estimates is closing as analysts forecast that demand for vaccines in 2022 will be very strong.
The key question for Moderna’s valuation is whether demand will stay strong in 2023. This question has no real answer right now as there are no serious forecasts for the course of the pandemic in 2023 as the world is focused on current problems.
In this environment, Moderna’s stock will remain in the hands of traders’ sentiment towards vaccine stocks and general market mood. In case traders calm down after the rapid increase in Treasury yields, Moderna stock will have a good chance to get back to recent highs as the fast pullback should attract enough traders who are searching for opportunities in the current market environment. If Treasury yields continue to rise at a fast pace and high-growth stocks stay under pressure, Moderna stock will likely move lower together with its peers.
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