Moderna shares all-time top-level test
Modern the stock gained massive upward momentum after the stock was including in S&P 500 and goes higher and higher. The stock, which recently traded below the USD 240 level, is currently trying to move above the USD 340 level, gaining more than 40% gains in just 5 trading sessions.
Recent market concerns about the spread of the Delta strain of coronavirus served as an additional bullish catalyst for Moderna stocks. Countries are rushing to secure new doses of vaccines, meaning Moderna has a good chance of generating solid revenues for years to come.
In a final deal, Takeda Pharmaceutical agreed to supply 50 million doses of Moderna’s vaccine to Japan. The additional doses could be delivered in early 2022. Similar deals could follow as more countries open up to the idea of booster doses, which is optimistic for Moderna and other vaccine makers.
What’s next for Moderna Stock?
Analysts’ estimates for Moderna’s earnings have not changed in recent days, and the stock is currently trading at nearly 19 forward P/E for 2022, which is a big increase compared to 13 forward P/E that was seen the end of June.
The valuation is being stretched and traders should be aware that the market will not have a good view of earnings after 2022 as the trajectory of the pandemic is unknown.
The forced buying of index funds that buy Moderna stocks because they were listed in the S&P 500 will soon end, and this factor will be out of the game.
Technically, RSI is in extreme oversold territory and the risks of a pullback are increasing day by day.
All in all, it seems that traders should be prepared for a pullback in Moderna stocks due to both fundamental and technical factors. The company’s market cap has risen significantly without any increase in earnings estimates, and traders will soon be taking some profits off the table after the big rally.
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This article was originally posted on FX Empire