Investors previously on the fence regarding Novavax (NASDAQ:NVAX) got the boost they needed on Sept. 23. An announcement that hit that day brought lots of investment into NVAX stock and sent shares surging some 11% higher.
The news? Novavax and the Serum Institute of India (SII) have jointly submitted the NVAX Covid-19 vaccine to the World Health Organization (WHO) for an Emergency Use Listing (EUL). If approved by the WHO, this will be a huge boon for both the company and its stock.
Here’s what you should know about NVAX stock moving forward.
NVAX Stock: What Is EUL and What’s Next?
What exactly does a EUL mean for Novavax, if it does achieve this status? The WHO website elucidates the following:
“[The EUL] is a risk-based procedure for assessing and listing unlicensed vaccines, therapeutics and in vitro diagnostics with the ultimate aim of expediting the availability of these products to people affected by a public health emergency.”
In short, Novavax’s Covid-19 vaccine could receive another shot in the arm from this submission if approved. That will expedite its distribution worldwide in the fight against the Covid-19 pandemic.
Of course, while it has submitted for the EUL, the vaccine does not have Emergency Use Authorization (EUA) in the United States. But if the Novavax vaccine is approved by the WHO, it will be a significant milestone for the company. After all, the WHO designation is a prerequisite for export to countries within the COVAX Facility, according to the Wall Street Journal.
The COVAX Facility provides for the equitable allocation and distribution of vaccines to participating countries and economies. This suggests that Novavax could serve a pivotal role for countries with relatively weaker bargaining power in procuring vaccines.
Last month, the company completed submission requirements for approval in India, Indonesia and the Philippines. It is also expecting news from the European Union in October.
Opening Streams of Revenue
So, what can we expect for NVAX stock now?
Maybe the most obvious outcome of this situation is that international revenue streams for Novavax will potentially increase. Only time will tell what actual sales the company will be able to derive moving forward. But the thrust of the announcement is clear: NVAX is in a better position and stands to make more money.
As most U.S. readers are likely aware, there are currently three vaccines approved by the U.S. Food and Drug Administration (FDA) for use against Covid-19. All three of are also approved by the WHO, which has approved seven in total. Still, it appears that this list could soon grow to include an eighth name.
Novavax has had several problems in dealing with the FDA. There have been multiple delays in the process. So, this news will also probably help the firm in future negotiations for approval in the United States as well.
The Bottom Line on NVAX Stock
Because of the WHO submission (and potential approval), investors can probably expect that NVAX’s chances of FDA approval have increased. In fact, investors have to assume that the EUL bodes well for Novavax stateside as well as worldwide. And if the WHO ultimately approves the vaccine, the stock will rise significantly.
Right now, this name’s average target stock price on Yahoo! Finance is around the $264 mark, somewhat higher than what it currently trades for. Further, the high target is $305. However, I believe this name has much higher to go.
One only needs to look at Moderna’s (NASDAQ:MRNA) price action to see why. MRNA has traded well above the levels that analysts have suggested it should for the past few months — and it shows little sign of slowing. In short, NVAX stock looks very attractive right now.
— Alex Sirois
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Source: Investor Place