Moderna price target raised to $18 from $15 at Leerink

Leerink raised the firm’s price target on Moderna (MRNA) to $18 from $15 and keeps an Underperform rating on the shares following the company’s annual Investor Day, where it provided a commercial and pipeline update. The firm notes Moderna announced a 5-year term loan facility for up to $1.5B from Ares Management Credit Funds – with a $600M initial draw this quarter, increasing the company’s FY25 cash guidance to $7.1B-$7.6B. The company reiterated FY25 revenue guidance of $1.6B-$2B revenue and FY25 GAAP operating expense guidance of $5.2B-$5.4B. Raising debt over equity makes sense to Leerink from a cost of capital perspective – though this also serves to make the company a more solvent counter-party for Roivant Sciences (ROIV) in ongoing IP litigation, given the substantial royalty award/settlement risk to Moderna, should the company be found to infringe.