If one of your new year resolutions was to take out a position in vaccine specialist Novavax (NVAX), then congratulations. The risk tolerant investment in a penny stock going for $3.99 a piece at the turn of year has paid off and then some. You are now looking at a stock worth $140.69, having gained 3,430% since nursing that new year hangover.
Novavax’ meteoric rise has been built on the house of COVID. The opportunity presented in finding the coveted coronavirus vaccine has placed Novavax in the rarified surroundings of “big pharma” companies.
Since setting out on the development of its COVID-19 vaccine candidate NVX-CoV2373, long time NVAX bull, B Riley FBR’s Mayank Mamtani has argued Novavax could yet spring a surprise and be the one to provide the desperately needed solution. The 5-star analyst’s case for Novavax was further bolstered on Tuesday with the release of more promising data.
In a study of cynomolgus macaques (a non-human primate), data form a viral challenge showed there is a correlation of anti-S and neutralizing antibodies with lung protection.
For Mamtani, this data reaffirmed his confidence in “the strong immune response expected with ‘2373 to correlate with long-term disease protection and minimized risk of antibody-dependent enhanced disease (ADE) or vaccine-associated enhanced respiratory disease (VAERD),” while further adding, “This accumulating evidence of high viral neutralizing titers conferring protection within upper respiratory track and in nasal tract suggests to us the increased likelihood of ‘2373 attaining sterilized immunity.”
What’s more, the NHP (non-human primate) cell-mediated immunity data indicates Novavax’ Matrix-M adjuvant increased “the absolute numbers of spike antigen specific T cells and proportion of multifunctional T cells including CD8 T cells.”
Mamtani expects the biotech to include cell-mediated data in the Phase 1 data disclosure. A Phase 1 study is currently in progress in Australia, and Novavax should release immunogenicity and safety data by the end of the month.
No change then to Mamtani’s rating, which remains a Buy. The analyst’s price target stays at $155 and implies potential upside of 16% from current levels. (To watch Mamtani’s track record, click here)
Among Mamtani’s colleagues, the verdict on Novavax is split. Among the 4 additional ratings, 2 say Buy while 2 say Hold. With Mamtani’s rating in tow, these add up to a Moderate Buy consensus rating. Overall, the analysts believe Novavax has surged enough for now, as the $117.20 average price target implies shares will decline by 12% over the next months. (See Novavax stock-price forecast on TipRanks)
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