As people acclimate to the new normal, it’s time to look at some vaccine stocks for sale.
Instead of relying primarily on vaccines and antiviral drugs, the government let people manage infections. Once infected with the less lethal strain, Omicron, people would self-isolate for a few days and then return to work. Moving away from its reliance on pharmaceutical companies, investors need to recognize that there are vaccine stocks out there that it’s time to sell.
The government has reduced orders for vaccines and antivirals, which is already hurting vaccine stocks. People realized that the Delta-variant-specific vaccine offered minimal protection against current strains. As subvariants of Omicron emerge, healthcare organizations will first assess the effectiveness of bivalent vaccines.
Investors should prepare for a sharp drop in sales of vaccines and test kits. These are the stocks of vaccines for sale.
Additionally, companies that rely on antiviral sales are likely to underperform. Yet their drop in income is less severe. The population most at risk of mortality and the lingering effects of infection needs antiviral drugs.
Abbott Laboratories (ABT)
Abbott Laboratories (NYSE:ABT) traded below $100 for the first time in two years. The company, which makes Covid test kits, fell out of favor in May amid its suspension of formula manufacturing.
The Food and Drug Administration made 15 key findings for Abbott’s baby formula production, including increasing the company’s workforce, training more staff, and owning more security equipment. Abbott also needs a modern computer system to provide the response team with real-time data.
Last quarter, Abbott reported Covid test sales of $2.3 billion. BinaxNOW in the United States accounted for 95% of these sales.
Ironically, surges and Covid lockdowns in China have slowed Abbot’s medical device revenue. Device sales increased 7.5% in the quarter. As the lockdown eases in China, the device sector could improve later this year.
Astra Zeneca (NASDAQ:AZN) is down more than 20% this month. Investors dumped the stock despite positive news related to Covid-19 treatments.
On September 16, the European Medicines Agency (EMA) recommended approval of AstraZeneca’s Evusheld. The drug is for people aged 12 or older with Covid-19 who do not need supplemental oxygen but are at increased risk of progression to a severe form of Covid.
Apart from Covid treatment, the European Union has recommended the approval of Beyfortus (nirsevimab). This medication provides protection against respiratory syncytial virus (RSV) disease.
The positive news did not encourage investors to buy AZN shares. The shares now trade at a forward price-to-earnings ratio of 15 times. In addition, the dividend of $1.90 per share yields 3.48%. Still, the attractive yield isn’t enough to offset the stock’s plunge of nearly 20% over the past month.
BioNTech (NASDAQ:BNTX) and Pfizer has submitted an authorization request to Swissmedic for a second bivalent COVID-19 vaccine.
The companies updated the vaccine with half of the original variant’s spike protein-coding mRNA. BioNTech engineered the other half of the mRNA to stimulate the production of neutralizing antibodies against Omicron.
Even though this submission will target Omicron’s BA.4 and BA.5 sub-variants, investors ignored the news. BNTX stock faced strong resistance at the 20-day simple moving average. Shares are down 45% since the start of the year.
More recently, the US Centers for Disease Control and Prevention said updated Covid booster shots for children should be available from early to mid-October.
Despite the implications of a higher addressable market for vaccine sales, investors are unimpressed. They’re betting that people won’t be giving their kids the next shot this fall.
Co-diagnosis (NASDAQ:CDX) lost eight cents per share in the second quarter. Revenue fell 81.7% from a year ago to $5.02 million.
The company praised its strong execution during the second quarter. For example, he continued the development and optimization of the CoDx PCR Home test platform. Investors expected more. Lower volumes of its Logix Smart Covid-19 test led to a sharp decline in revenue.
Public support for funding screening programs is declining. The government requires little or no travel and public places. The general downward trend in test kits is unstoppable. Investors assume another wave is unlikely.
Co-Diagnostics stressed that experts believe further waves of Covid variants are inevitable. If the mutations increase the risk of contracting the infection, it could reverse the negative downward trend in demand for test kits.
The company could direct its activities towards the development of a decentralized and affordable PCR testing platform. However, it cannot rely on detecting Covid alone. More diseases will emerge from other viruses. Still, the company is not prepared to rely on any tests other than Covid.
Novavax (NASDAQ:NVAX) fell 31% last week. The downtrend accelerated after JP Morgan (NYSE:JPM) downgraded the title. He cited the company has weak long-term prospects, making it one of the vaccine stocks to sell now.
Regulators approved Novavax’s first protein-based vaccine in 2022. However, demand for a vaccine peaked in the first and second waves more than 12 months ago. Weak product sales will increase the risk of quarterly losses. Countries that have ordered the vaccine may cancel or reduce the number of units. Novavax faces operational risks when costs exceed revenues.
If Novavax is operating with negative cash flow, it will have to raise funds by selling shares. Unfortunately, the bear market is not receptive to biotech companies with uncertain prospects. The company might need to realign its efforts to develop a vaccine against another disease, such as the flu. This strategic change will have a higher cost.
Investors are wary of owning a business that could lose more money. The NVAX action is an action to avoid.
Pfizer (NYSE:DFP) said it cut drug development cycle time by 2.5 years. Paxlovid is an antiviral drug that is an example of rapid development, but markets are bearish on the outlook for the drug.
The stock is showing signs of falling as it nears its 52-week low.
The company’s overall outlook does not depend on the pandemic. For example, it projected a revenue potential of $25 billion from 2025 to 2030. It has the cash flow and financial flexibility to deploy its capital.
In a bear market, investors fear higher spending, even when Pfizer is spending on research and development.
In June, Valneva (NASDAQ:VALN) has received approval from the European Commission for marketing authorization in Europe for its VLA2001 vaccine.
Since then, investors have become more confident that the pandemic is over. Even though Valneva has the best covid drug with fewer side effects, people still may not want it.
In August, the company reduced its revenue for the fiscal year. He cited a drop in demand for Covid vaccines from EU member states. In the first half, the company lost 150.4 million euros. Since EU member states reduced their order volume, Valneva has suspended manufacturing of the vaccine. In addition, it suffered a depreciation of 100.6 million euros.
Investors don’t have the patience to own a company that is losing money. In this bearish environment, they demand profitable businesses with strong drug prospects. The demand for vaccines is low around the world. Valenva’s dependence on the European market undermines the size of its potential market.
Avoid VALN stocks.
As of the date of publication, Chris Lau had (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.