Yahoo Finance Moderna (MRNA) Beats on Q2 Earnings, Starts $3B Buyback Program
Moderna, Inc. MRNA reported earnings of $5.24 per share for the second quarter of 2022, beating the Zacks Consensus Estimate of $4.45. The company had reported earnings of $6.46 per share in the year-ago quarter. The year-over-year decline in the bottom line was due to higher operating expenses incurred during the second quarter.
Revenues in the quarter were $4.75 billion, significantly beating the Zacks Consensus Estimate of $3.85 billion. Total revenues were up 9.1% year over year, driven by increasing product sales, entirely from the COVID-19 vaccine.
Quarter in Detail
Product sales were $4.53 billion, up 8% year over year, driven by a higher average selling price due to a favorable customer mix. However, sequentially the sales figures declined 23.5%.
Grant revenues were $183 million compared with $139 million in the year-ago quarter. Collaboration revenues were $35 million compared with $18 million in the year-ago quarter. The company earns collaboration revenues from agreements with several big pharma/biotech companies, including AstraZeneca AZN, Merck and Vertex Pharmaceuticals.
Selling, general and administrative expenses were $211 million, up 74.4% year over year. The upside can be attributed to an endowment to the Moderna Charitable Foundation and an increase in certain commercialization costs.
Research & development expenses were $710 million, up 68.6% from the year-ago period. The significant increase was primarily attributable to higher clinical costs and personnel-related expenses.
The company ended the quarter with $18.1 billion in cash and cash equivalents, compared with $19.3 billion as of Mar 31, 2022.
Share Buyback
Earlier this month, Moderna’s board of directors authorized an additional share repurchase program of $3 billion. Its previous share repurchase program, which was initiated in February 2022, has nearly $1 billion outstanding.
Following the opening bell on Aug 3, Moderna’s shares moved up 14.4%, likely due to the buyback announcement. In the year so far, shares of the company have declined 36.7% compared with the industry’s 22.1% decline.
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2022 Guidance
Moderna stated that it has advanced purchase agreements with different countries for Spikevax and its booster doses worth approximately $21 billion. For the second half of the year, the company believes that sales in the fourth quarter will be greater than sales in the third quarter.
The company expects R&D and SG&A expenses to be approximately $4 billion in 2022. It expects capital expenditure to be in the range of $600 million to $800 million.
Coronavirus Vaccine Update
This June, Moderna received emergency use authorization (“EUA”) from the FDA for its COVID-19 vaccine, Spikevax, as a primary two-dose regimen in individuals aged six months to 17 years.
Moderna has been developing several variant-specific booster doses of its COVID-19 vaccine, some targeting a specific virus strain like Omicron while some are targeting a couple of strains. Last month, MRNA announced new clinical data on its bivalent COVID-19 vaccine booster candidate mRNA-1273.214, which was developed to target the Omicron variant.
The new clinical data showed that study participants who received a 50 µg dose of mRNA-1273.214 (irrespective of prior infection or age) generated higher neutralizing antibodies against the Omicron subvariants BA.4 and BA.5, following a month-long administration compared with those who received a booster dose of Spikevax.
Moderna has also started the development of mRNA-1273.222, a new bivalent candidate targeting the Omicron variant, specifically for the U.S. market. The company also entered into an agreement with the U.S. government to supply 66 million doses of mRNA-1273.222 for a payment of $1.74 billion.The deal also includes an option to purchase up to 234 million additional doses.
Other Key Pipeline Updates
Moderna has several other mRNA-based pipeline candidates targeting different indications in its pipeline. The leading candidates among them are mRNA-1010, mRNA-1345 and mRNA-1647, evaluated in pivotal studies as a seasonal flu vaccine, respiratory syncytial virus (RSV) vaccine and a cytomegalovirus (CMV) vaccine, respectively.
Two separate ongoing pivotal phase III studies are evaluating Moderna’s CMV and RSV vaccine candidates, respectively.
During the second quarter, Moderna accelerated the development of its influenza vaccine program. While the company started dosing adult participants in a pivotal late-stage study evaluating mRNA-1010, its mRNA-based flu vaccine, it also started a phase I/II study evaluating two seasonal influenza vaccines, mRNA-1020 and mRNA-1030, targeting hemagglutinin and neuraminidase, two major surface glycoproteins that help the influenza virus to infect.
Last month, Moderna also started an early-stage study evaluating its Nipah-virus (NIV) vaccine candidate, mRNA-1215. The company’s Zika virus candidate, mRNA-1893, also entered into phase II clinical development.
We note that Moderna has regained rights to its VEGF therapeutic, AZD8601, from its partner, AstraZeneca. Moderna is evaluating the next steps for the program. Other than AZD8601, AstraZeneca is collaborating with Moderna on another candidate. Currently, AstraZeneca and Moderna are evaluating MEDI1191, an mRNA-encoding for IL-12, as monotherapy or in combination with its anti-PD-1/PD-L1 drug, Imfinzi, in patients with advanced solid tumors.
Moderna, Inc. Price
Moderna, Inc. price | Moderna, Inc. Quote
Zacks Rank & Stocks to Consider
Moderna currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the overall healthcare sector include Eli Lilly LLY and Jazz Pharmaceuticals JAZZ. While Jazz Pharmaceuticals sports a Zacks Rank #1 (Strong Buy) at present, Eli Lilly carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Estimates for Jazz Pharmaceuticals’ 2022 earnings have increased from $17.05 to $17.06 in the past 30 days. JAZZ’s earnings estimates for 2023 have increased from $18.05 to $18.15 in the past 30 days. Shares of Jazz Pharmaceuticals have risen 19.9% in the year-to-date period.
Earnings of Jazz Pharmaceuticals beat estimates in three of the last four quarters and missed the mark on one occasion, the average surprise being 12.81%. In the last reported quarter, JAZZ delivered a negative earnings surprise of 0.53%.
Eli Lilly’s stock has risen 15.9% this year so far. Eli Lilly’s earnings estimates for 2022 have gone up from $8.29 per share to $8.34 per share, while that for 2023 has increased from $9.47 per share to $9.55 per share over the past 30 days.
Eli Lilly missed earnings estimates in three of the last four quarters while beating the mark on one occasion. Eli Lilly has a four-quarter earnings surprise of 2.26%, on average. In the last reported quarter, LLY delivered a negative earnings surprise of 12.93%.
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