Moderna Inc. experienced a notable surge in its stock price following the U.S. Food and Drug Administration's (FDA) approval of its new COVID-19 vaccine, mNEXSPIKE (mRNA-1283), marking a significant moment for the biotech company amid ongoing financial and market challenges.
The FDA granted limited approval for mNEXSPIKE on May 31, 2025, authorizing its use in adults aged 65 and older, as well as individuals aged 12 to 64 who have at least one underlying health condition that elevates their risk from COVID-19, as defined by the Centers for Disease Control and Prevention (CDC). This approval reflects a targeted approach to protect high-risk populations, mirroring similar restrictions previously set for competitor Novavax's vaccine.
The newly approved vaccine represents a leap forward in Moderna's vaccine technology. It requires only a 10 microgram dose—one-fifth the dose of Moderna's original Spikevax vaccine—which is made possible by refined immune targeting technology. This lower dose could potentially reduce side effects and improve vaccine accessibility. The approval was underpinned by a Phase 3 clinical trial involving approximately 11,400 participants aged 12 years and older. Results showed that mNEXSPIKE demonstrated a 9.3% higher relative vaccine efficacy compared to Spikevax in individuals 12 and older, and a 13.5% higher efficacy in adults aged 65 and above.
The safety profile of mNEXSPIKE was comparable to that of Spikevax, with fewer local reactions reported and systemic reactions such as fatigue, headache, and muscle pain remaining similar. Moderna's CEO, Stéphane Bancel, highlighted the importance of the new vaccine, stating, "This approval adds an important new tool to help protect people at high risk of severe disease from COVID-19," especially poignant given that over 47,000 Americans succumbed to the virus in 2024.
Financially, Moderna has faced a turbulent period. Despite the positive news, the company's shares have endured an 82.47% decline over the past year, sharply contrasting with the S&P 500's 12.92% gain during the same period. Year-to-date, Moderna's stock is down 36.12%, while the broader market has inched up 0.51%. On May 30, 2025, shares closed at $26.56, down 1.37% for the day, but surged nearly 5% in premarket trading on June 2, reaching $27.87, reflecting investor optimism following the FDA announcement.
Moderna currently holds a market capitalization of approximately $10.27 billion and maintains cash reserves of $5.98 billion, providing a financial buffer amid operational challenges. However, the company's financial metrics reveal a negative profit margin of 105.67%, diluted earnings per share of negative $8.73, and negative free cash flow of $3.2 billion, underscoring the pressure on profitability and cash sustainability.
Analysts offer mixed views on Moderna's outlook. The average one-year price target from 20 analysts stands at $46.85, suggesting a potential upside of over 76% from the current stock price, with targets ranging broadly from $20 to $198. Meanwhile, brokerage consensus rates the stock as a "Hold," reflecting cautious optimism. GuruFocus estimates the fair trading value at $20.41, implying a possible downside of 23.16%, further illustrating the uncertainty surrounding Moderna's near-term prospects.
The approval of mNEXSPIKE arrives at a critical juncture for Moderna, which recently endured a significant setback when the U.S. Department of Health and Human Services terminated a $590 million contract aimed at developing pre-pandemic influenza vaccines. This contract termination dealt a blow to Moderna's pipeline, particularly its mRNA-based pandemic influenza vaccine efforts. Despite this, the company remains committed to pandemic preparedness and plans to explore alternative avenues for advancing its H5 avian flu vaccine program.
Looking ahead, Moderna expects to offer mNEXSPIKE alongside its existing vaccines, Spikevax and mRESVIA—the latter targeting respiratory syncytial virus (RSV)—for the 2025-2026 respiratory virus season. The company is also pursuing regulatory approvals for mNEXSPIKE in multiple international markets, aiming to broaden its global footprint.
Industry analysts view the FDA's approval as an incremental win for Moderna, particularly given the challenging regulatory environment under Health and Human Services Secretary Robert F. Kennedy Jr., who has expressed skepticism toward mRNA COVID-19 vaccines. William Blair analysts note that while the approval may not dramatically boost Moderna's COVID-19 vaccine sales, it is a crucial step in the regulatory pathway for Moderna's combo flu/COVID vaccine product, mRNA-1083, which incorporates mNEXSPIKE as its COVID-19 component.
Despite the recent good news, Moderna's path forward is fraught with challenges. The company reported trailing twelve-month revenues of $3.18 billion but suffered a net loss of $3.36 billion, with negative returns on assets and equity. Success will hinge on Moderna's ability to diversify its mRNA platform beyond COVID-19 vaccines, potentially into treatments for cancer, rare diseases, and other infectious diseases.
Moderna's stock volatility remains pronounced, with a 52-week trading range from $23.15 to $158.82, reflecting the market's shifting sentiment. The company's substantial cash reserves provide some cushion, yet the negative free cash flow signals ongoing operational pressures. Investors and industry watchers will be closely monitoring Moderna's innovation pipeline, regulatory developments, and financial performance in the months ahead.
As Moderna prepares for the upcoming respiratory virus season, its new vaccine approval offers a glimmer of hope for the company and high-risk populations alike, promising enhanced protection amid a continually evolving pandemic landscape.
