MRNA: Oncology Pipeline Progress Will Drive Long Term Upside Despite Litigation Risk

Analysts have modestly lowered their price target on Moderna to about $35.78 from $37.32 per share, reflecting slightly softer long term growth and valuation assumptions. This comes even as recent Investor and Analyst Day updates, new debt financing and evolving oncology data support a more stable cash outlook and gradual margin improvement.

Analyst Commentary

Street research remains divided on Moderna, with most firms keeping cautious ratings even as they adjust models for updated cash guidance, oncology data, and the Ares term loan. Recent price target revisions span from the high teens to low thirties, underscoring a wide range of views on long term execution, profitability timing, and litigation overhangs.

Bullish Takeaways

• Bullish analysts point to the new five year, $1.5B term loan facility as a value supportive move that extends the cash runway into FY25 and beyond without diluting shareholders. This is seen as supporting a higher floor under the equity value.
• Updated guidance for FY25 cash of $7.1B to $7.6B, alongside reiterated revenue and operating expense ranges, is viewed as improving visibility on liquidity and de-risking near term solvency concerns that have weighed on valuation multiples.
• Some analysts see emerging oncology data, including responses in PD L1 positive tumors and progress with the individualized neoantigen therapy program, as validating the broader cancer platform and helping justify option value in outer year models.
• Improving gross margin trajectories and anticipated 2026 vaccine revenue contributions from international markets such as the U.K., Canada, and Australia are incorporated into refreshed models as key drivers of medium term top line growth and operating leverage.

Bearish Takeaways

• Bearish analysts maintain Underperform or equivalent ratings, arguing that even with higher cash balances, the company faces an extended path to profitability and that current enterprise value still embeds ambitious assumptions for pipeline success.
• There is concern that the heavy reliance on debt, while preferable to equity in the near term, increases financial leverage and may pressure long term returns if revenue recovery and margin expansion fall short of current guidance.
• Ongoing IP litigation, including potential royalty or settlement payments related to lipid nanoparticle technology, is seen as a material overhang that could absorb a meaningful portion of the enhanced cash position if outcomes are unfavorable.
• Some models reflect lower long term price targets despite near term financial improvements. Analysts who hold this view cite significant execution risk in scaling the oncology franchise, competitive vaccine dynamics, and the possibility that consensus expectations for 2026 to 2028 revenue are still too optimistic.

What's in the News

• Reports indicate Moderna is in talks with at least one large pharmaceutical company regarding a potential deal of significant scope, including a possible buyout, highlighting strategic interest in its mRNA platform (STAT News).
• The CDC has revised a webpage to state that studies have not ruled out the possibility that infant vaccines may cause autism, drawing attention to aluminum adjuvants and prompting renewed scrutiny of vaccine makers including Moderna, even as scientists emphasize that extensive research has found no proven link (Wall Street Journal).
• Health Secretary Robert F. Kennedy Jr. said he directed the CDC to change its website language on autism and vaccines, with the agency now stating that the claim vaccines do not cause autism is not evidence based, adding policy and reputational uncertainty for vaccine developers such as Moderna (New York Times).
• A CDC advisory panel voted to end the universal recommendation that all age groups receive Covid shots, shifting toward case by case decisions between patients and providers, a move that could weigh on long term demand expectations for Moderna's Covid vaccines (Bloomberg).
• Moderna lowered its full year 2025 revenue guidance to a range of $1.6 billion to $2 billion, tightening and reducing the high end of its outlook and signaling expectations for a 15% to 33% year over year revenue decline (company guidance filing).

Valuation Changes

• Fair Value: lowered modestly from $37.32 to $35.78 per share, reflecting slightly softer long term assumptions.
• Discount Rate: risen marginally from 7.13% to 7.13% (rounded), implying a slightly higher required return on capital.
• Revenue Growth: reduced slightly from 10.31% to 10.22%, indicating a minor tempering of long term topline expectations.
• Net Profit Margin: essentially unchanged at around 16.03%, suggesting stable long run profitability assumptions.
• Future P/E: lowered from 38.70x to 37.20x, indicating a modest compression in the multiple applied to forward earnings.