(Bloomberg) -- Moderna Inc. plunged Friday, losing its title as the best-performing stock on the S&P 500 Index this year.
Shares of the Covid-19 vaccine maker sank 17% to the lowest since July 13 after rival Pfizer Inc. said its Covid-19 pill reduced hospitalizations and deaths. Today's selloff has pushed the stock down to the seventh-best performing stock on the S&P 500 this year with Devon Energy Corp. in the top spot followed by Marathon Oil Corp.
“Moderna was in the lead for Covid-19 vaccines and consensus has already come down,” Oppenheimer Holdings analyst Hartaj Singh said in an interview. “The stock market sees the upside as now capped because Pfizer has options for both prevention and treatment.”
Its shares lost 31% this week, or roughly $43 billion in value, their biggest wipeout ever as advancements in two potential coronavirus pills and an unexpectedly weak revenue forecast for its own shot fueled investor concerns about the company's growth potential.
The Cambridge, Massachusetts-based biotech had rallied after winning the second U.S. authorization of a Covid vaccine in December and its show-stopping gains seated it at the top of the S&P 500 immediately after the stock joined the benchmark gauge in July. Moderna's stock is still up more than 100% this year.
With Moderna trading at levels only seen before its S&P inclusion, Singh, who rates the stock a hold-equivalent, expects a rebound if it's able to show a quarter or two of improving sales and an upbeat 2022 forecast.
“We do think today is an over-reaction for Moderna's stock as one to two quarters of impressive vaccine sales could easily get the stock going again,” Singh said.
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