(Bloomberg) — Moderna Inc.’s shares have dropped 50% this year as investors pulled back from Covid-19 healthcare stocks and staged a broader rotation out of growth names.
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The biotech firm fell 7.3% on Monday amid a broader market selloff and has erased $52 billion in value this year. Investors were concerned over the future revenue of Covid-19 vaccines and increasing competition in the space. The stock has fallen about 74% from its record closing high of $484.47 set in August 2021.
“Increasing competition and lack of visibility” about future sales has led to a loss of investor interest across the Covid-19 complex, Oppenheimer analyst Hartaj Singh, who has a market perform rating on Moderna, said in an interview.
Moderna soared during the pandemic as it raced to develop a Covid-19 vaccine. Its 143% gain last year made it the third-best stock in the S&P 500. It’s been on a breakneck ascent upward since debuting in 2018, skyrocketing by 434% in 2020.
By 2022, investors were looking ahead to future Covid-19 vaccine demand amid growing debate about the timing and need for boosters, as interest in pandemic-focused healthcare names waned. Impending Federal Reserve interest-rate hikes and the ongoing Russia-Ukraine war have also hurt sentiment across global stock markets. The S&P 500 Index has dropped nearly 12% this year, while the Nasdaq 100 Index is down about 18%.
Among other vaccine makers, BioNTech SE and Novavax Inc. have each fallen by at least 51% this year, while the S&P 500 Health Care Index has declined 7.8%.
“I think there’s a Covid loss of interest,” SVB Leerink analyst Daina Graybosch, who has a market perform rating on BioNTech and does not cover Moderna, said in an interview. “I see it across the board.”
(Updates with shares in headline and second, fifth and sixth paragraphs)
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