Investors in Moderna Inc (NASDAQ:MRNA) are expecting the COVID-19 vaccine to bring in US$10-15bn worth of sales in 2021/2022.
It would be followed by around US$2-3bn of sustainable booster sales.
That’s why the market capitalisation is now sitting around US$60bn, having soared over 50% in the last week, analysts at Morgan Stanley said.
“Investors now believe mRNA vaccines will take the vast majority of the US market given growing investor concerns around adenovirus vaccines and in particular the recent AstraZeneca,” they noted.
“We believe investors now expect much higher near-term COVID-19 cash flows (over US$10bn in 2021 sales) as well as a high probability of success for the rest of Moderna's mRNA vaccine pipeline.”
While there is no discussion over the potential for sales next year, investors are still debating on what may happen thereafter.
For primary vaccinations occurring beyond 2022, bears argue that pricing will drop significantly due to other vaccines coming into play, while bulls argue that additional governments will be forced to buy an mRNA vaccine due to better efficacy, the bank said.
Around the booster market, bears see either low pricing and/or a lack of the need for a booster while bulls see a higher price after the pandemic ends and a sustainable booster population.
“We believe there will be a robust booster market for at least the initial few years after the pandemic ends,” analysts said.
“We also believe there will be a need to boost most vaccinated people, but the frequency of that boost is harder to predict.”
The stock jumped 11% to US$170.03 on Tuesday, having rocketed 66% compared to last week's prices.