Moderna Inc. (MRNA Stock) - Down 30% YTD, Can it Rally Back?

The Massachusetts based biotechnology company Moderna Inc. (NASDAQ: MRNA) stayed off red despite a sales drop in Q1 2023. MRNA stock prices dropped by almost 30% in 2023; even a positive earning report failed to boost the share price.

The stock was trading at $125.33 at press time, dropping 0.19% in the last 24 hours. Also, Canada has authorized Moderna’s SPIKEVA BA.⅘ BIVALENT covid vaccine for booster doses in the age group of 6 to 17 years.

Moderna Inc. – Staying Afloat Despite Sales Drop How?

In Q1 2023, Moderna’s revenue was under $1.9 Billion, considerably down from Q1 2022 of $6.1 Billion. In the meantime, the operating expenses swelled by 21% to $22 Billion. The biotechnology company suffered operating losses of $366 Million. The only reason the stock price stayed out of red was a tax benefit of $384 Million, which significantly reduced the expenses.

Looking at the picture from another lens, it becomes clear that their expenses are a mere percentage of revenue. Considering its main operating expenses, it accounted for a significant portion of previously used revenue. In the last quarter, operating expenses accounted for 120% of revenue, which was 30% in Q1 2022.

This news can be considered flawed for investors as expenses could be going better with revenue. However, the company has invested in its capabilities and building facilities, so even if they are generating less revenue, they are working on developing other products and vaccines. Hence it can be said that the expenses didn’t grow only because the revenue declined.

Even though Moderna did not suffer losses in Q1, a simple look at its chart shows that the MRNA stock price is moving south. Inventors are cautioned to expect the company to remain unprofitable once they noticeably reduce the scale of its operation or bring a revolutionary product to the market to make up for the revenue losses.

Both the possible changes are not visible on the horizon, at least in the short term; this scenario creates some tough times for Moderna investors.

At press time, Moderna Inc. (NASDAQ: MRNA) stock was trading at $125.33 with a slight correction of 0.19%. Previous close and open were at $125.57 and $125.92, respectively. This brings the 52-week change in price to a drop of 8.01%. With an average volume of 3.55 Million shares, the market cap stands strong at $47.777 Billion. With a 2.36 rating for HOLD, analysts placed the price target at $179.13 with a 42.9% upside.

The company’s quarterly revenue growth dropped by 69.30%, the profit margin hiked by 31.77%, and the operating margin was up by 26.62%. EBITDA was reported to be $5.17 Billion, and diluted EPS was $11.31. The total cash in hand is $8.92 Billion, and the company’s debt is $1.11 Billion. D/E is more than required at 5.87.

The last earnings were reported on May 4, 2023, with estimated revenue of $1.178 Billion and reported to be $1.862 Billion. This brings a surprise of $683.904 Million and a hike of 58.05%.

Moderna Inc. (NASDAQ: MRNA) – Candle Exploration

The current MRNA share price is close to the demand zone; it will bounce off the zone and consolidate between it and the immediate resistance at $138.81. A slight southwardmovement in EMA and oversold RSI hints toward a bearish trend. If the price actions decide to move north, it will have to counter the immediate resistance.

It would take many variables to favor the company for its share price to enter and break the supply zone.

Disclaimer:

The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.