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For months, biotech companies and government officials talked about eventually needing a coronavirus booster vaccine. Now that the delta variant accounts for 98.8% of new U.S. infections, the possibility of wheeling out a booster is more real.
Moderna Inc. stock (NASDAQ: MRNA) got a huge pop since rolling out its initial vaccines. It's up 466% year over year.
Now, investors hope another round of vaccine distributions may fuel the company's bottom line and translate to similar gains. They could be right...
On Wednesday, the Biden administration announced it will begin offering booster shots the week of Sept. 20, after concluding that a third shot is needed to fight off decreasing immunity.
The booster shot plan only applies to the Pfizer-BioNTech and Moderna vaccines. It calls for Americans to get a booster shot eight months after receiving their second doses.
Although the Biden administration's plan has drawn mixed reactions, one thing is certain: A second wave is coming to vaccine stocks.
Here's why Moderna stock is one of the best stocks to buy now...
Why MRNA over Other Vaccine Stocks?
It's no secret Moderna struck gold with its first approved commercial product, the COVID-19 vaccine. The company was further along in its mRNA research than about every other biotech vaccine maker. And its focus on that enabled quick and effective vaccine distribution.
A short 63 days after the virus' genetic sequence was published, Moderna was on the short list of companies with a vaccine. Only Pfizer-BioNTech beat it by a week as the first company to go public with one.
Still, investors preferred Moderna. Its stock is up 466% year over year, compared to Pfizer's 36.6% bump and BioNTech's 415.88% increase.
This is important as the United States approaches a second wave of vaccine distribution. Moderna has sent vaccines internationally and through the United States. However, with news of the Biden administration's booster plan, investors will be revisiting vaccine stocks - and the public has already proven partial to MRNA.
On top of developing additional vaccine candidates, Moderna has locked down a contract to deliver $12 billion worth of COVID-19 vaccines in 2022. The contract includes options for clients to purchase more doses worth roughly $8 billion, totaling $20 billion for Moderna.
This Is More Than "Just a COVID-19 Vaccine Stock"
While it seems as if MRNA may be a "one-hit wonder" stock, it's anything but.
The company has been busy researching and developing messenger RNA technology since its founding in 2010. Messenger RNA (mRNA) basically trick cells into creating proteins that look as if they've been infected by something that a virus uses to infect cells.
The last eight years of research positioned the company to succeed amid the vaccine race - mRNA vaccines are much easier to mass produce quickly.
However, this focus on mRNA is another reason Moderna is a more appealing stock than its competitors. The company has been developing vaccines for HIV and respiratory syncytial virus (RSV). The latter, especially dangerous to infants, toddlers, and the elderly, has made a comeback as societies reopen, even showing up out of season.
Beyond its vaccine development, Moderna is also working to develop 13 different mRNA treatments. Five of them aim to combat cancer and two autoimmune therapies. They are currently going through clinical trials.
This company has the kind of pipeline that could generate multi-billions in sales over the next decade and beyond.
Money Morning Defense and Tech Specialist Michael A. Robinson gave some conservative projections on MRNA with per-share profits averaging 25%. At that rate, earnings will double in about 33 months.
That doesn't even account for another Moderna breakthrough in trials or lines of research.
Creativity in biotech research has boomed internationally, with the United States at the forefront. Whether it's wheeling out life-saving vaccines in record time or developing another game-changing tech breakthrough, an eruption of potential profits is in reach for any one of these companies.
Moderna has more than enough potential to be a titan in the industry and is already making waves.
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