Moderna Stock: Is MRNA Underperforming the Healthcare Sector?

Valued at a market cap of almost $13.4 billion, Moderna, Inc. (MRNA) is a biotechnology company that primarily focuses on discovering and developing messenger RNA (mRNA) based therapies. The Cambridge, Massachusetts-based company’s mRNA platform enables the rapid development of vaccines and treatments for infectious diseases, cancer, and rare genetic disorders.

Companies worth $10 billion or more are typically classified as “large-cap stocks,” and Moderna fits the label perfectly. The company gained global recognition for its COVID-19 vaccine, demonstrating its ability to scale production and deliver life-saving solutions efficiently. Moderna continues to expand its pipeline with promising candidates in areas such as oncology, cardiovascular diseases, and respiratory infections. Its strong research and development capabilities, strategic partnerships, and commitment to cutting-edge science position it as a leader in the biotechnology industry.

Despite its notable strength, this biotech company has tanked 79.7% from its two-year high of $170.47, reached on May 24, 2024. Moreover, it has fallen 17.2% over the past three months, considerably lagging behind the broader Health Care Select Sector SPDR Fund’s (XLV) 2.8% uptick over the same time frame.

In the longer term, MRNA stock has declined 66.5% over the past 52 weeks, significantly underperforming XLV’s marginal loss. Moreover, on a YTD basis, shares of MRNA are down 16.7%, compared to XLV’s 5.4% gain.

To confirm its bearish trend, Moderna has been trading below its 200-day moving average since August 2024 and has remained below its 50-day moving average since late June 2024, with some fluctuations.

On Mar. 5, shares of Moderna skyrocketed 15.9% as a couple of SEC filings revealed that Moderna’s CEO Stephane Bancel and director Paul Sagan acquired MRNA’s common stock worth $6 million. Additionally, the company also secured a legal victory in a patent dispute against Pfizer Inc. (PFE) and BioNTech SE (BNTX), further bolstering investor confidence.

Moreover, on Feb. 14, MRNA’s stock closed up 3.4% after its Q4 earnings release despite delivering a loss of $2.91 per share, worse than the expected loss of $2.68. Its bottom-line figure reflected a significant decline from the prior year's Q4 profit of $0.55 per share. Its revenue of $966 million plummeted 65.6% year-over-year as COVID-19 vaccine sales declined due to shifting market conditions and the earlier launch of its updated vaccine in the United States, which pushed a portion of sales into the third quarter.

However, on the brighter side, revenue exceeded consensus estimates by 2.5%, and the company successfully reduced operating expenses by 21.1% through cost-cutting measures. Additionally, it aims to remove nearly $1 billion in costs by the end of 2025 and aims to secure up to 10 product approvals by 2027, reinforcing investor confidence.

Moderna’s underperformance looks even more pronounced when compared to its rival, Novavax, Inc.’s (NVAX) 60.4% gain over the past 52 weeks and marginal decline on a YTD basis. 

Given MRNA’s recent underperformance relative to its broader sector, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from the 26 analysts covering it. The mean price target of $61.48 suggests a massive 77.6% premium to its current levels.