Vaxart (VXRT) stock has been very volatile over the last year. While it's up 29 percent so far in 2021, it's down over 70 percent from its 52-week highs. What’s the forecast for VXRT stock in 2021? Has it bottomed and will it rise from these levels, or should investors expect more downside?
Vaxart is working on a COVID-19 vaccine candidate. However, unlike the other vaccines like Moderna, Pfizer, and AstraZeneca, which are being administrated across the globe through syringes, Vaxart is developing an oral vaccine candidate.
While Vaxart is a clinical-stage biotech company, it's also making revenues from some of the products. The company reported revenues of $4.05 million in 2020, which were less than half of what it reported in 2019.
The company’s sales tumbled to $506,000 in the first quarter of 2021 from $2.9 million in the second quarter of 2020 primarily due to lower royalty revenues from the sales of Inavir in Japan. The demand was lower due to lower seasonal influenza cases in the country. The company’s net loss swelled to $16 million in the first quarter of 2021 compared to $1.3 million in the first quarter of 2020.
The revenues dropping to less than a fifth and the losses swelled over 10x in a quarter. There aren't healthy financials. However, more than the current earnings (or losses), VXRT is a play on the COVID-19 vaccine candidate that it's developing.
VXRT COVID-19 vaccine candidate
On May 5, Sean Tucker, Vaxart’s Chief Scientific Officer, presented at a virtual event organized by the World Vaccine Congress Washington. He offered insights on the trial results of the company’s oral vaccine candidate and compared it with vaccines from Moderna and Pfizer.
The initial trial results look encouraging. The Phase 1 trials on 35 subjects didn't produce any severe adverse event and “triggered multiple immune responses against SARS-CoV2 antigen,” according to Vaxart.
The company is expected to begin multiple trials in 2021 including in Latin America and India. India is currently the worst affected country reporting nearly 400,000 daily coronavirus cases.
VXRT stock forecast
The forecast for VXRT stock looks positive. According to the estimates compiled by CNN Business, VXRT has a median target price of $11.5, which is a 56 percent premium over the current prices. Its highest and lowest target prices are $13 and $10, respectively. The stock is covered by only two analysts and both of them have a buy rating.
COVID-19 vaccine stocks are dropping.
Meanwhile, we’ve seen a drop in stocks of many companies that are developing vaccines or drug candidates for COVID-19. On May 5, Cocrystal fell sharply after announcing a discounted stock sale.
Also, CytoDyn (CYDY) trades at a fraction of its recent highs. The company’s Leronlimab was provided to some patients in the Philippines under the Compassionate Special Permit. However, the stock couldn't sustain the initial euphoria and is down over 72 percent from its 52-week highs.
Will VXRT stock rise or fall?
VXRT stock might have bottomed and could rise from these levels. Like all clinical-stage biotech companies, VXRT is a speculative play. However, what I find particularly interesting about the company is the vaccine administration which is oral rather than through a syringe. This would help take away the vaccine hesitancy in some people.
Citing data from a poll, Vaxart says that 23 percent of Americans don’t plan to get a COVID-19 vaccine. Meanwhile, 32 percent of the people or 18.7 million Americans, looked amenable to taking the vaccine if it was administrated as a pill instead of using a syringe.
What risk does Vaxart face
Several countries including India are pushing for an IPR waiver for COVID-19 vaccines. This would help scale up production and lower costs. However, that might be a challenge for companies like Vaxart since it might risk being late to the game. That said, after the crash, the risk-reward dynamics look favorable for Vaxart stock.