Novavax (NVAX)

Initiate at Strong Buy – Last but Not Least

Published April 15, 2021

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Key Takeaways


  • We initiate STARS coverage on Novavax, Inc. (NVAX) with a Strong Buy opinion and 12-month target price of $250, 6.5x our 2022 EPS estimate, a discount to the 11.5x biotech/pharma peer average multiple.

  • We think NVAX’s vaccine technology, which is based on more than 10 years of nanoparticle vaccine development, is unique and offers distinctive advantages compared to existing vaccines. The company’s genetic engineering of the virus genes combined with chemical synthetization enable superior immune responses based on clinical studies, in our view.

  • We think NVAX’s Covid-19 protein subunit vaccine candidate is well-placed to receive the fourth Emergency Use Authorization in the U.S. in the second quarter, which will be rapidly followed by regulatory approvals in other countries, in our view.

  • Despite successful and speedy vaccine rollouts in the U.S., the pandemic may not be over anytime soon due to the emergence of new and more dangerous virus variants, which could make booster shots necessary, in our view.

  • We think 2021 could be a turnaround year as NVAX already has agreements to supply a total of 290 million doses of the Covid-19 vaccine to six developed countries. As a late-stage biotech firm, NVAX has no commercialized product as of April 2021. However, we think NVAX should start generating a bottom-line profit in the second half of the year following successful approval and distribution of its Covid-19 vaccine.

  • NVAX’s other vaccine candidates targeting influenza (in Phase 3 clinical trials), other infectious diseases and its combination vaccines under development, targeting several viruses at once, are very promising in the medium term, in our view.


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