Moderna is ‘clawing back market share’ from Pfizer, analyst says

Oppenheimer Analyst Hartaj Singh joins Yahoo Finance Live to discuss fourth quarter earnings for Moderna.

Video transcript

JULIE HYMAN: Uh, we are also watching shares of Moderna today and they have been bucking the downtrend that we've been seeing in broad markets here. The company's revenue last quarter came in ahead of estimates. There was initially some negative reaction to expenses for the year, but now that has turned around.

Let's talk to Hartaj Singh about all of this. He's an analyst at Oppenheimer, covers the biotech industry. Hartaj, good morning. So what do you make of the, sort of, turnaround that we saw in the Moderna shares where there initially seemed to be concern about expenses and then investors shrugged it off?

HARTAJ SINGH: Yeah, Julie. It's, you know, honestly, I mean, we're neutral rated on Moderna, right, but we've always really liked the story from a long-term perspective. You know, to me, this is a good sign actually.

There's been a lot of negative sentiment around the name, around COVID 19, companies, in general, companies related to the COVID 19 epidemic. Moderna being at the forefront of that. And I think this, sort of, reversal is a good sign, because investors now are starting to pay attention to fundamentals.

And in that regard, this was a good quarter. They had a good quarter. Probably the guidance for the full year is maybe not what people are expecting, maybe slightly weaker, but they'll keep on adding sales. And so the second half of year-- second half of this year, the sales will be stronger.

And then, um, you know, they're starting to get back market share from Pfizer, that's the key thing. You know, you could argue that their vaccine is slightly better than Pfizer BioNTech. And the fact that now they're starting to claw back some market share, it was a good sign.

BRIAN SOZZI: Hartaj, Moderna mentioning something pretty interesting in their earnings release. They say, quote, "The virus will evolve to an endemic phase in 2022." What does that mean for this company's sales and profits? How fast are they likely to grow in this endemic phase?

HARTAJ SINGH: You know, one of the things I really like about this company, Brian, is that they're not prone to, sort of, overplaying their hand or overstating things. They're very careful what they say. And part of that is they don't want to raise expectations and the other part is they don't want to alarm people.

Uh, I think what the company is saying, and from their development what you can look at, is that they still expect, potentially, variants to-- to occur. An endemic phase is more like the flu, sort of, happens in the Northern Hemisphere once every year and usually in the fall and the winter, but they are paying attention to the Southern Hemisphere. They are seeing, could the virus mutate again, but they've got quite a few vaccines in development. And they showed some data on a bivalent vaccine that goes against the ancestral strain and against the Omicron strain that could be better, you know. And that could be the booster for the fall of this year.

So, you know, to me, this is a company that's very close to the ground, not alarming people, but yet being-- letting people know that we have to stay-- we have to be careful and we have to prepare for the fall where people should be getting shots again.

JULIE HYMAN: Hartaj, we are going to be speaking to Stephane Bancel of Moderna in the next hour. And I'm just or I should say two hours from now, excuse me. And I should mention or I should-- I wanted to ask you what you would ask him. What do you think is the, sort of, key question for Moderna going forward?

HARTAJ SINGH: You know, Julie, honestly, look while the pipeline kind of builds itself out, and this harks back to what Brian just asked me. It is not so much what do you think your sales are going to be in 2022, you know. That's because he can't really tell us, right, with high degree of certainty.

But the real question to him is how come you've got the better vaccine and commercially Pfizer and BioNTech are, for lack of a better term, still taking you to the woodshed, right? How are you going to claw back that market share? How are you going to actually get ahead?

If they can get to pole position, which would be ideal by the end of this year, I mean, that would be a huge boost to-- to their share price. So I think that's the critical question for Stephane this year is how do his commercial teams execute worldwide and get some of this market share back.

JULIE HYMAN: Well, we'll ask him that. Thanks so much, Hartaj. Good to see you. Be well, Hartaj Singh of Oppenheimer on Moderna. And as we mentioned, we're going to be hearing from Stephane Bancel, the CEO at 11:15 this morning.