3 min read

A Triple in 7 Months: What's Next for Moderna

Even as the company's stock becomes part of the S&P 500, Moderna's share price still has big gains ahead! In my opinion, the stock is still only just getting started on its path towards yet-larger profits.
A Triple in 7 Months: What's Next for Moderna
Photo by Braňo / Unsplash

Hi everyone, it's Jeff Yastine. We're on the hunt for great stocks and big profits, here at the goodBUYreport!

Speaking of great stocks and big profits....

Moderna (MRNA)!

This is a stock I've been talking about for a long time.

Keep reading below, or watch the video!

Back in March I told the subscribers to my newsletter - in our inaugural issue - to buy the stock. We're up 150% from that date to now...

But this is also a stock I've been mentioning from time to time on YouTube, so anyone can watch for free if they subscribe to my YouTube channel.

I mentioned this stock last December, and also when it was trading at its lows this year at $104 back in the beginning of January. I said it was a highly undervalued stock given the profits that it should earn this year, and the valuation that Wall Street was willing to give it at that time.

So someone for free could watch the video. If they bought the stock at $104...they tripled their money!

In fact, that was the title I gave the video at that time "Why Moderna (MRNA) Will Double or Triple in 2021".

So it begs the question, "Where to from here?" now that Moderna is starting to get recognition from the insitutional investor community now that the stock goes into the S&P 500,officially on tap for tomorrow.

I still think there's more upside from here - not necessarily tomorrow or next month. The stock has come pretty far already in a very short period of time.

But I'll get to my price projections in a moment...

Here's a look at the stock as it stands right now...a beauty to behold.

I think the stock will likely  hit somewhere between $600 and $1,000 a share sometime in the next 12-18 months.

I consider Moderna the ultimate defensive stock. The longer the pandemic goes on, with all the variants creating so much trouble for everyone from a health perspective, and consternation for all of us as investors - it means the path towards even larger profits is still wide open for this stock.

We're only still getting started on the amount of profit that Moderna is set to earn.

That's key to why I see $600 to $1,000 for the stock over the next 12-18 months.

This year, Moderna will earn more than $25 a share in profits.

But if we use a price/earnings ratio - divide the share price ($313) by its earnings per share level ($25.70)...it gives us a p/e ratio of a little over 12.

That's far too low for a company that's already growing as fast as Moderna. It reflects a Wall Street perception that we're supposed to conquer the virus faster, and that in a year or two there won't be as much need for the vaccines.

But as you know, this fight is going on far longer - and considering the growth of the new variants - will likely continue for more years than anyone thought.

Getting back to my point about p/e ratios - even a garden variety growth stock typically gets a p/e ratio of at least 30, if not 40 and higher.

So if we multiply a p/e of 30 by this year's earnings per share of $25.70, we get a stock price of over $750.

If we assign a p/e of 40 by those EPS, it gets us a stock price of $1,000 a share.

None of this includes the potential "kicker" to owning Moderna's stock, which is the potential for COVID booster shots.

Health officials are still weighing the pros and cons of vaccine boosters. But according to a recent report in Politico.com, the Biden administration is leaning in that direction, at least for the most vulnerable Americans.

Recently Moderna's competitor, Pfizer-Biontech, asked the FDA for approval to begin marketing COVID booster shots.

Moderna hasn't filed an official request yet, but Moderna's co-founder - stem cell biologist Derrick Rossi - recently said he thought "boosters are most likely going to be in the cards."

The prospect of COVID booster shots will only add further to Moderna's profit prospects in coming quarters.

Best of goodBUYs!