Should you invest in Novavax shares after inking a covid vaccine manufacturing deal?
- Novavax shares on Friday edged lower 1.75% despite announcing a covid vaccine manufacturing deal.
- It signed a $372 million deal with Polish biotech firm Mabion SA to produce NVX-CoV2373 from Dec. 2021.
- The manufacturing deal runs through 2025 with an option for extension.
On Thursday, Novavax Inc. (NASDAQ:NVAX) shares edged lower 1.75% after announcing a covid vaccine manufacturing deal. The company signed an agreement with Polish biotech firm Mabion SA to produce a COVID-19 vaccine candidate antigen under the name NVX-CoV2373. The deal starts in December 2021 through 2025 with an option to extend.
The agreement comes following Novavax’s previously delayed protein-based covid vaccine candidate, NVX-CoV2373. The company has generated promising results from a larger phase three trial, which indicated 100% protection against moderate and severe covid-19. It also showed an efficacy rate of about 90%.
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Should you bet on Novavax’s exciting growth?
From an investment perspective, NVAX shares trade at an attractive forward P/E ratio of just 5.13, making the stock compelling to value investors. Moreover, analysts expect its earnings per share to skyrocket by 416% next year, bouncing back from this year’s forecast decline of 32%.
Therefore, growth investors could also look to add the stock to their portfolios. As a result, NVAX shares could gain significantly ahead of next year’s earnings growth.
Is a rebound imminent?
Technically, Novavax shares appear to have recently plummeted to trade below the 100-day moving average. As a result, the stock has fallen closer to the oversold conditions of the 14-day RSI.
Therefore, a rebound could be on the horizon. As a result, investors could target potential profits at about $217, or higher at $259.24. On the other hand, if the pullback continues, NVAX could find support at $118.81, or lower at $78.69.
It could be time to buy NVAX
In summary, although Novavax has faced some hurdles commercializing its covid-19 vaccine, its deal with Mabion SA could signal a significant milestone in the process. Moreover, NVAX shares offer exciting growth prospects at a compelling valuation of 5.13 forward P/E.
Therefore, with the stock also approaching oversold conditions, it could be time to buy before a rebound.
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