Novavax is a 'super volatile stock,' strategist explains

Novavax (NVAX) recently reported its second quarter results, missing estimates on revenue and adjusted earnings while slashing its full-year outlook for revenue. Despite this, Novavax's stock edges higher in Thursday trading.

Mizuho healthcare equity strategist Jared Holz joins Catalysts to give insight into Novavax's performance and how the vaccine maker may operate moving forward.

Holz bluntly states: "This is a super volatile stock, not that surprised that it's up today. When you just look at the valuation of a company that's worth a little bit more than a billion and is still going to do roughly $400 to $500 million in sales next year with the vaccine, you're not looking at a huge multiple. But when you kind of zoom out here, this COVID market for vaccines, I think is going to be incredibly disappointing, not only this year but in the out years."

For more expert insight and the latest market action, click here to watch this full episode of Catalysts.

This post was written by Nicholas Jacobino

Video transcript

Stick with obviously the Pharma sector and talk about what we're seeing in Novavax today because we're seeing a huge move following their earnings report.

You're looking at shares really moving to the downside the company slashing its revenue forecast.

And actually now we're looking at gains of just about 2%.

So a bit of a reversal there, I'm curious and this is a stock that tends to be extremely volatile following the earnings reports that we are getting.

But I'm curious, uh there's a lot riding obviously, just in terms of what demand is going to look like for the vaccine, whether or not they're gonna see the updated shot here for the fall season and and what that is ultimately gonna look like on a global scale as well.

What do you see the future looking like here for Novavax amidst all of that uncertainty?

Yeah, for sure.

This is a super volatile stock.

Um Not that surprised that it's up today when you just look at the valuation of a company that's worth a little bit more than a billion and is still gonna do roughly 400 to 500 million in sales next year.

With the vaccine, you're not looking at a, at a huge multiple.

Um but when you look at, when you kind of like zoom out here, this COVID market for vaccines, I think is going to be incredibly disappointing, not only this year but in the out years, barring some unforeseen pick up in a very severe strain of the virus, which has not really happened in some time.

Now, we're four years away from peak pandemic levels.

We've really not seen anything overly um discouraging or concerning um relating to the virus in a number of years.

I just think the population is kind of vaccined out.

I've been saying that for a while, I do think there's an, you know, there's a faction of the population that, you know, wants this extra protection every year.

Um the elderly people with, you know, a lot of comorbidities that are very, very kind of paranoid about what getting COVID again could do.

But I feel like we're in the midst of just a market in perpetual decline.

So for Novavax, that has a low revenue base, it's a little bit different.

Um because again, as a $11.2 billion company, you can kind of make the numbers work.

But, you know, broadly speaking, I just feel like COVID vaccines as we know them are going to decline for a number of years.