It hasn't been a great afternoon session for Moderna investors, who have watched their shares sink by -1.4% to a price of $60.2. Some of you might be wondering if it's time to buy the dip. If you are considering this, make sure to check the company's fundamentals first to determine if the shares are fairly valued at today's prices.
Moderna Has an Attractive P/B Ratio but a Worrisome P/E Ratio:
Moderna, Inc., a biotechnology company, discovers, develops, and commercializes messenger RNA therapeutics and vaccines for the treatment of infectious diseases, immuno-oncology, rare diseases, autoimmune, and cardiovascular diseases in the United States, Europe, and internationally. The company belongs to the Health Care sector, which has an average price to earnings (P/E) ratio of 26.07 and an average price to book (P/B) ratio of 3.53. In contrast, Moderna has a trailing 12 month P/E ratio of -3.9 and a P/B ratio of 1.97.
When we divideModerna's P/E ratio by its expected five-year EPS growth rate, we obtain a PEG ratio of 0.12, which indicates that the market is undervaluing the company's projected growth (a PEG ratio of 1 indicates a fairly valued company). Your analysis of the stock shouldn't end here. Rather, a good PEG ratio should alert you that it may be worthwhile to take a closer look at the stock.
The Firm Has a Declining EPS Growth Trend:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $135 | $60 | $803 | $18,471 | $19,263 | $6,848 |
| Operating Margins | -306% | -910% | -95% | 72% | 49% | -62% |
| Net Margins | -285% | -857% | -93% | 66% | 43% | -69% |
| Net Income (M) | -$385 | -$514 | -$747 | $12,202 | $8,362 | -$4,714 |
| Net Interest Expense (M) | $2 | -$8 | -$6 | -$29 | -$45 | -$124 |
| Depreciation & Amort. (M) | $25 | $31 | $31 | $232 | $348 | $617 |
| Diluted Shares (M) | 81,114 | 331 | 381 | 431 | 416 | 382 |
| Earnings Per Share | -$4.95 | -$1.55 | -$1.96 | $28.29 | $20.12 | -$12.33 |
| EPS Growth | n/a | 68.69% | -26.45% | 1543.37% | -28.88% | -161.28% |
| Avg. Price | $16.43 | $18.12 | $62.5 | $247.68 | $155.92 | $60.2 |
| P/E Ratio | -3.32 | -11.69 | -31.89 | 8.17 | 7.33 | -4.88 |
| Free Cash Flow (M) | -$437 | -$491 | $1,959 | $13,336 | $4,581 | -$3,825 |
| CAPEX (M) | $106 | $32 | $68 | $284 | $400 | $707 |
| Current Ratio | 7.02 | 7.89 | 1.43 | 1.76 | 2.73 | 3.42 |
