Novavax Stock Slammed With Hefty Price-Target Cut

The analyst said the drugmaker's recent guidance cut may not have been low enough

Deputy Editor
Sep 22, 2022 at 9:42 AM
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The shares of Novavax, Inc. (NASDAQ:NVAX) are 4.9% lower this morning, last seen trading at $24.60, following a bear note from J.P. Morgan Securities. The firm downgraded NVAX to "underweight" from "neutral," and issued a hefty price-target cut to $27 from $132, saying that the drugmaker's recently lowered second-quarter revenue guidance might not have been enough as Covid-19 vaccine dynamics shift considerably in the U.S. and Europe.  

Coming into today, the brokerage bunch was split, leaving space for additional bear notes. Specifically, while three rated Novavax stock a "hold" or "sell," four analysts still recommended a "strong buy." What's more, the 12-month consensus target price of $105.83 is a massive 309.1% premium to last night's close, indicating a round of price-target cuts is long overdue. 

There's room for options traders to change their tune as well, as calls have been a popular choice in recent weeks. This is per NVAX's 10-day call/put volume ratio of 2.71 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits higher than 86% of readings from the past year. In other words, these bullish bets have been getting picked up at a much quicker-thank-usual clip of late.

Today's drop puts the security at its lowest level since April 2020, as it heads back toward its pre-pandemic levels. The equity finished yesterday's session nearly 92% below its Feb. 8. 2021 all-time high close of $319.93. The 10-day moving average began pressuring the shares lower in early August, and NVAX is now down more than 81.9% year-to-date.

 

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