Are Vaccine Stocks A Buy on Earnings?

Well, it looks like the majority of the world population is now vaccinated for COVID-19. 51% of the global population are at least partially vaccinated for a total of 3.91 billion people with at least with one dose.

But the U.S., as I talked about last week, has fallen behind on a global scale. 58.4% of the U.S. is fully vaccinated and 67.3% with at least one dose, placing 17th on the world scale.

The good news is that Pfizer Inc.’s (PFE) COVID-19 vaccine has now been approved for use by the Centers for Disease Control and Prevention (CDC) for children aged five to eleven years old in the U.S., which will hopefully boost vaccination numbers.

Now that the COVID-19 vaccine is available to virtually everyone in the country, the biotech companies working on the vaccine behind the scenes are going to have some serious profit potential, as was evident in Pfizer’s and Moderna Inc.’s (MRNA) most-recent earnings results this week.

So, let’s take a quick look at their earnings results.

Pfizer (PFE): Earnings Reported on Tuesday, November 2

Pfizer is one of the world’s largest pharmaceutical companies and develops a variety of medicines and vaccines, including one for COVID-19. The mRNA vaccine from Pfizer and BioNTech SE (BNTX) is currently the most administered in the U.S. with 241 million doses.

For its third quarter, PFE reported better-than-expected adjusted earnings of $1.34 per share, which topped analysts’ expectations for adjusted earnings of $1.09 by 23.5%. Earnings are up 86% year-over-year from the $0.72 earned in the third quarter of 2020. Third-quarter revenue of $24.09 billion slightly beat estimates calling for $22.81 billion, topping previous year’s quarter by 98.62%.

The company also raised full-year 2021 sales forecasts for the vaccine by 7.5% to $36 billion. The vaccine brought in sales of $13 billion to the company for the third quarter, which topped estimates of $10.88 billion. The company is also on track to deliver 2.3 billion of the COVID-19 vaccines out of the approximate 3 billion they plan to produce this year.

It was a wild week for Pfizer shares. They initially jumped more than 5% on the strong earnings results but then took a turn on Wednesday, falling 3% after it was announced that the Merck & Co., Inc. (MRK) COVID-19 antiviral pill was approved for widespread use in the U.K. The U.S. Food and Drug Administration (FDA) has not approved the Merck oral treatment yet.

But then on Friday, the stock surged more than 10% after Pfizer announced that it also has a COVID-19 pill that decreases the likelihood of COVID-related deaths or hospitalizations by 89% in a clinical trial.

Moderna Inc. (MRNA): Reported on Thursday, November 4

As you know, Moderna has its own COVID-19 vaccine, which is second in distribution with 154 million doses. The vaccine has significantly contributed to the company’s top and bottom lines, aiding the stock’s nearly 234% increase this year, though the biotech company still reported weaker-than-expected earnings and revenue in its latest quarter.

For the third quarter, MRNA reported earnings per share of $7.70 on $4.97 billion in revenue. Analysts were expecting earnings of $9.42 on revenue of $6.29 billion, so the company missed earnings estimates by 18.3% and revenue estimates by 20.9%.

The company also announced that it aims that to deliver between 700 million and 800 million more doses, instead of the 800 million to one billion that was expected. Sales for the COVID-19 vaccine are expected to come in between $15 billion and $18 billion instead of the previous guidance for $20 billion, which pales in comparison to PFE’s expected $36 billion this year.

However, the company remains optimistic. CEO Stephane Bancel stated, “We are humbled to have helped hundreds of millions of people around the world with our COVID-19 vaccine and yet we know our work is not done.”

Unfortunately, this optimism wasn’t enough to help the stock. It fell 20% on earnings and then more than 24% on Friday following the announcement of Pfizer’s COVID pill.

My Vaccine Stock Pick

Despite their earnings, these companies are not my favorite biotech stocks. I like BioNTech SE (BNTX), which is working with Pfizer on the COVID-19 vaccine

BioNTech SE (BNTX) is my pick for the biotech industry right now for several reasons. Not only has BNTX been working with PFE on the current COVID-19 vaccine, but it seems to be a favorite of the Biden administration.

Now, the stock was down 22% this week on the Pfizer COVID-19 pill news; however, I’m not too worried. As of now, vaccinations are still ultimately more effective at preventing COVID hospitalizations and spread of the virus, with about 95% efficacy. BioNTech is also working with Pfizer to test variant-specific vaccines, which can be designed in a matter of days.

The companies are also preparing testing procedures like preclinical research, manufacturing, clinical testing, and regulatory submission to get a head start should a variant-specific vaccine be needed. In August, the companies started a trial of a multivariant vaccine targeting both the Delta and Alpha variants, though they have no plans to release it to the public.

But what sets BNTX apart from PFE and MRNA is its incredible performance and its growth potential. For example, take a look and see how these companies have performed year-to-date:

As you can see, BioNTech has soared 203% over the past year with Moderna closest behind at 131%. Pfizer has climbed just 36%, though it still beats out the S&P 500’s 31% gain during the same time period.

My Accelerated Profits subscribers have been along for the ride, as my Project Mastermind system flagged BNTX back in April 2021, when the stock was trading around $156.

I should add that BNTX is not a one-trick pony and has several other projects in the works other than the COVID-19 vaccine. The company is also working on cancer treatments. In fact, it’s currently advanced 15 oncology product candidates in 18 ongoing clinical trials. BioNTech is also working on a malaria vaccine for the African continent and anticipates starting a clinical trial by the end of 2022.

Now, BioNTech SE will lay out its cards next Tuesday, November 9, when it reports its third-quarter earnings results. Currently, analysts expect earnings of $2.27 on revenue of $5.93 billion. The stock has a solid history of earnings surprises, so a fourth-straight earnings surprise could be in the cards.

The bottom line is that BNTX has the superior fundamentals to keep trekking higher while the world combats COVID-19 and beyond.

But it’s far from the only fundamentally superior stock on my radar right now. My Project Mastermind system found another fundamentally superior stock that is well-positioned to benefit from the trucking shortage in the U.S.. I released the name and buy advice on Thursday. If you missed it, simply sign up here and I’ll give you all the details.


Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

BioNTech SE (BNTX)

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