Shares of Novavax (NVAX), a pharmaceutical company, declined over 6% following the release of its third-quarter results. Though the company reported a lower-than-expected loss and surpassed revenue estimates, it lowered its full-year revenue guidance, which hurt investor sentiment.
For the quarter, Novavax reported a net loss of $0.76 per share, an improvement from the $1.26 loss in the same period last year and better than analysts’ average estimate of a $0.79 loss per share.
Moreover, NVAX reported $84.5 million in revenue, which beat the analysts’ expectations of $73.8 million. However, the top line fell 55% from the year-ago quarter.
Declining COVID-19 Vaccine Sales Hurt Outlook
Novavax lowered its full-year revenue guidance to $650 million-$700 million, down from the previous forecast of $700 million to $800 million. Product sales are now expected between $175 million and $225 million, down from prior guidance of $275 million to $375 million.
The lower outlook is primarily due to declining demand for Novavax’s COVID-19 vaccine, which currently holds a modest 2-3% market share. It faces stiff competition from mRNA vaccines developed by Pfizer (PFE) and Moderna (MRNA).
NVAX Provides Clinical Trial Update
On a positive note, NVAX recently said that the U.S. Food and Drug Administration (FDA) has lifted the hold on one of the company’s clinical trials. This trial involved a new combination of COVID-19 and influenza vaccines. The hold was imposed after a case of motor neuropathy in a participant. Motor neuropathy can cause weakness in the hands and arms, hindering patients from performing daily tasks. With the hold now lifted, Novavax can proceed to Phase 3 trials for these vaccine candidates.
In another positive update, Novavax received authorization from the FDA and European Commission for its updated COVID-19 vaccine for the 2024-25 season, for individuals aged 12 and older.
Is Novavax a Good Stock to Buy?
Turning to Wall Street, NVAX has a Moderate Buy consensus rating based on three Buys, two Holds, and one Sell assigned in the last three months. At $17, the average Novavax price target implies a 100.95% upside potential. Shares of the company have gained 76.25% year-to-date.
