Novavax (NVAX) Crashes 30% After a Deep Guidance Cut, Analyst 'Frustrated'

August 9, 2022 7:32 AM EDT
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Price: $18.20 -1.99%

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Shares of Novavax (NASDAQ: NVAX) crashed almost 33% in premarket Tuesday trading after the company cut its full-year revenue guidance.

For the second quarter, Novavax reported a loss per share of $6.53, much worse than the anticipated loss of $5.24. Revenue came in at only $185.9 million while analysts were looking for as much as $974.5 million in Q2 sales.

On a full-year basis, Novavax sees revenues between $2 and $2.3 billion, much lower than the prior forecast of $4 billion to $5 billion. The street consensus was at $4.18 billion.

JPMorgan analyst Eric Joseph said NVAX delivered a “remarkable” topline miss.

“After printing its first profitable quarter in 1Q on the heels of initial APA drawdowns, this quarter’s weak performance is not all too surprising, and dovetails with the broader backdrop of COVID vaccine oversupply in high income countries and low Nuvaxovid administration rates to date… We struggle to see the levers that would drive meaningful new orders in the near-term,” Joseph told clients.

The analyst sees NVAX shares trading “rangebound” as he expects “product demand trends to continue as the primary focus over the mid-term.”

Cowen analyst Georgi Yordanov noted frustrations among analysts and investors after the print but continues to rate NVAX at Outperform.

“We continue to stand by our original thesis: that the shares remain undervalued for the future, likely more consistent, annual endemic opportunity,” Yordanov wrote in a research note.

“We remain optimistic that Novavax has a path to compete in the much more consistent annual re-vaccination endemic market, as long as management executes.”

By Senad Karaahmetovic

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JPMorgan, Cowen & Co, Senad Karaahmetovic