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Moderna, Pfizer on the move on concerns about weak demand for COVID vaccines

Shares of Moderna (MRNA) and Pfizer (PFE) are on the move after Pfizer CFO David Denton projected a COVID vaccination rate of only 24% this year in the U.S. The demand for COVID vaccinations has dwindled, with data indicating it's less than half of what is expected for flu shots. Despite Moderna's efforts to expand its business, it remains heavily reliant on COVID vaccinations and booster shots. Yahoo Finance's Seana Smith and Brad Smith discuss the details of how the declining demand for COVID immunizations could affect vaccine makers moving forward.

Video transcript

BRAD SMITH: Moderna and Pfizer. Pfizer shares in focus right now as they are moving higher. But Moderna doing the opposite. Moderna lower right now by about 4/10 of a percent. So some fractional moves, but in different direction.

This week, the finance chief of Pfizer forecasting weaker demand for COVID shots this year. Pfizer is predicting a roughly 24% COVID vaccination rate in the US this year. That's less than half of the vaccination rate against the flu. You also had something similar come out from Moderna as well.

So a larger question-- and for many of these companies, they could have seen this. They should have seen this coming, especially as for the vaccination campaigns that rolled out very early on, and the number of inoculations that were administered at everywhere from a CVS to a Walgreens and Moderna and Pfizer being some of the early beneficiaries of that. There was a larger question of, OK, so what would that tail cycle look like, as you started to see a wind down in the push for, but also, the receipt of vaccinations, even if that was on a booster basis going forward.

SEANA SMITH: Yeah. And we certainly know that this is so important to their businesses, especially though for Moderna. And that's really why we saw such a reaction in their stock yesterday following this announcement here, I guess you can call it, from Pfizer's CFO.

But they're working to diversify their business. They've been doing that for quite some time. But they're still heavily reliant on COVID shots, at least for now, when you talk about their business in 2023, even into early 2024. So any sort of expectation of weaker than expected demand obviously is going to have a real impact on Moderna's shares specifically.

And we saw Moderna get hit pretty hard yesterday. The biggest one-day decline that we've seen since the start of the year closed down yesterday, off about 9%. Off another 1% or so this morning. Now essentially flat though on the day. So we'll see what exactly those numbers look like.

24%, like you just said, of forecast that Pfizer is expecting Americans will get updated COVID shots. A bit better than what we saw last time. Only about 17% got the booster that was released last fall, as of May. So a bit of an uptick there on a year-over-year basis. But certainly well below what Moderna, what Pfizer, and what many investors have been hoping to see.

BRAD SMITH: Yeah. Something we're continuing to track, especially as we consider the amount of people that might look at, and hear any news about the newest variant, and decide, OK, just let me get booster before the winter comes.

SEANA SMITH: It doesn't hurt to be safe.