Why Moderna stock is rallying today

Moderna (NASDAQ:MRNA) shares are rallying Monday, with the stock up more than 10%, trading over the $114 per share mark. The move has seen MRNA climb to its highest level since January, adding to its gains so far this year after a dismal 2023.

Why Moderna stock is rallying

According to a government trial website, the drugmaker is beginning a mid-stage study to try its experimental cancer vaccine in patients with cutaneous squamous cell carcinoma, a form of skin cancer. The trial is in collaboration with Merck.

Furthermore, in a note released to clients on Monday, analysts at UBS said that in a fireside chat on Moderna’s latent virus platform, they noted the potential Ph3 CMV data this year, which they see as an underappreciated catalyst for shares and a “large potential opportunity ($3B+) for MRNA.”

“From the call we thought mgmt sounded confident heading into the potential Ph3 data this year, and overall we left the call with increased conviction in the potential for MRNA's CMV program and its broader latent virus portfolio,” said UBS.

Overall, UBS continues to believe MRNA's platform and broader pipeline are underappreciated, and they remain focused on Ph3 CMV data which they think is likely a potential upside driver for shares.

Elsewhere, Jefferies, which has a Buy rating and $115 price target on Moderna, noted that Merck posted a new Phase 3 study with the Moderna cancer vaccine V940. They stated it “is now the third Phase III study for Merck, which suggests even more investment put to work on the program and speaks to continued confidence in a broad program.”

Moderna updates

In Moderna’s fourth quarter results, the company acknowledged that 2023 was a year of transition as it adapted to the endemic market.

It also noted “significant pipeline advancements across infectious diseases, oncology and rare diseases,” as well as the increased COVID-19 market share in the U.S.

The drugmaker said it continues to expect initial regulatory approvals of its RSV vaccine (mRNA-1345) starting in the first half of 2024. It expects full-year 2024 research and development expenses of approximately $4.5 billion.

Meanwhile, in a call earlier in the year, Moderna provided a pipeline update, noting that it entered the year with 45 therapeutic and vaccine programs, nine of which were in late-stage development.

The company expects its COVID-19 franchise to be profitable in its anticipated sales scenarios for 2024 and further ahead and it projects approximately $4 billion in product sales in 2024, mostly in the second half of the year, primarily due to COVID-19 vaccine sales and the launch of its RSV vaccine.

Moderna revealed in January that the Phase 3 trial of its combination vaccine against seasonal flu and COVID-19 was fully enrolled, and it anticipates data from the study in 2024.