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So here we have the monthly chart of Moderna, one of the top performers in the market in the past 18 months. I believe that it has entered into a bear market and will correct to 150-180 and eventually low 100's.
Most influenza pandemics are widely known to be cyclical in nature, often showing up in 2-3 waves. The most famous recent pandemic, the 1918 influenza epidemic was a 3 wave virus over 24 months, shown below.
Other well known pandemics and endemics also exhibit 3 waves. The H5N9 endemic in China is another example of this, lasting just under 30 months.
Our current pandemic is shown below, exhibiting the 3 wave pattern, going on the 20th month.
Relating to Moderna, the price chart looks to be in a classic Elliot Wave pattern of 12345-ABC, correlating with the US daily deaths chart, shown by the Elliot Waves in the charts above and below: Crest 1 on June 2020 with the inital COVID wave, Crest 3 on the new year of 2021, and Crest 5, marking the topping of the 3rd wave of the pandemic and Moderna stock, on September of 2021.
An example of textbook Elliot Waves is shown below.
Given the paths that historical pandemics have followed, I believe that our current COVID-19 pandemic has topped out and will dissipate fizziling out in the next 4 months, following the ways of the 1918 pandemic and the 2013-2015 H5N9 endemic, and Moderna stock will follow.
On a valuation side, I see an issue. Moderna is approved in about 100 countries, with a population total of about 3.65B people in them. Moderna is currently not approved in India (1.4B people), but I have added their population to my total market share amounts to price in any future approval there. In these countries Moderna is approved in, they are competing against other vaccine makers most notably AstraZeneca and Pfizer/BioNTech, so I have given them about a 50% market share from the 3.65B total market, which I also believe is conservative. Taking into account Moderna's recently raised prices for 25.50 per dose in wealthier nations, and their cheaper doses at 10.00 per dose in developing countries, I calculated a weighted average of about 17.50 per dose.
Taking Moderna's net income margin, which is 63.50% currently, which I rounded up, and also making adjustments for their unrelated pipeline products, gives us that Moderna will sell 6 doses per every single person in their market share, based on a current market cap of 135B they are trading at today of 335 per share, or an entire new round of inital 2 doses of shots with 1 booster. From the earlier wave analysis of pandemics, since I believe that the pandemic is currentely cresting the 3rd wave, I believe this is entirely unrealistic.
From the current Moderna press releases, they have 30B of realized revenue from the shots, not including future purchase options. This 30B of revenue under an average of 17.50 per dose and market size of 1.822B people in the market, gives us that Moderna has currently sold 0.94 doses per person in their market currently, well under the 6 doses priced in right now. If all purchase options are excercised, this will bring the total doses per person in the market to about 1.10, and I have doubled this to 2.25 doses per person in their market, to account for future orders, which I again believe is overly conservative. Doing this gives us total revenue of 70B, and total profit of about 45B for all doses sold. On a per share basis, after making time value and pipeline adjustments, this comes out to about $120 per share, which is my target price.
From this, I am currently short Moderna.