Is it time to cash in Novavax shares?
Vaccine Developer Novavax (NASDAQ: NVAX) Stock fell (-61%) in 2022. The company’s protein-based COVID-19 vaccine, Nuvaxovid, has been launched in Europe and is awaiting CDC approval for launch in the United States. US FDA approval was granted on July 13e making it the fourth COVID-19 vaccine approved in the United States, but still needs CDC approval to begin marketing. The company had its first profitable quarter in its history in the first quarter of fiscal 2022. The market adage “Buy the rumor and sell the news” applies here. The COVID-19 pandemic sent Novavax stock skyrocketing from a low of $6.26 in February 2020 to a nosebleed high of $331.68 in February 2021. While most COVID vaccines in the US have been supplied by Pfizer (NYSE: PFE) and Moderna (NASDAQ: MRNA) or Johnson and Johnson (NYSE: JNJ), there is optimism for Nuvaxovid apps for those unable to tolerate mRNA technology.
Side effects are all over the news
Recently, the European Medicines Agency (EMA) indicated that serious allergic reactions would be added to the label as a side effect, including paresthesia and hypoesthesia. The vaccines have an effectiveness rate of 90.4% according to its trials in the United States and Mexico. The company may prove to be a one-off wonder as Nuvaxovid’s FDA approval marks its first in 35 years. Novavax has $20.11 cash per share and no long-term debt with a small float of 78 million shares with 19% short interest. However, the race for COVID-19 vaccines has already been won by the top three and there are very few indications of significant demand in the United States. Investors expecting a return to earlier highs should reconsider using opportunistic exit levels to gain strength.
Publication of results for the first quarter of fiscal year 2022
On May 9, 2022, Novavax released its fiscal first quarter 2022 results for the quarter ending March 2022. The company reported earnings per share (EPS) of $2.56 compared to analysts’ consensus estimate of 2, $49, a beat of $0.07. The company saw revenue increase 57.4% year-over-year (YoY) to $703.97 million, which was below analyst estimates of $845.2 million. The company reaffirms its fiscal 2022 revenue forecast of $4 billion to $5 billion, down from analysts’ estimate of $4.49 billion. Novavax CEO Stanley Erck commented, “Novavax has been successful in launching our protein-based COVID-19 vaccine globally and executing our plans for continued label expansion for pediatrics and homologous and heterologous enhancement. Strengthened by our profitable first quarter, with $704 million in revenue, we continue our robust commercial deployment. Importantly, as new variants emerged, we advanced our strategy to be ready for the dynamic environment and continue development beyond COVID-19 with our combination vaccine candidate COVID. -19-flu.
NVAX Opportunistic Exit Levels
Using rifle charts on the weekly and daily timeframes provides an accurate view of the landscape for the NVAX stock. The Rifle’s weekly chart hit a low of $37.37 and staged a rally as shares hit a high of $76.77 ahead of the FDA approval announcement. Shares sold off and sparked a mini reverse PUP breakdown on the rejection of $73.91 Fibonacci level (fib). The weekly uptrend ended with a 5-period moving average (MA) at $55.92 and a 15-period MA at $52.92. The weekly 200-period MA resistance sits at the $84.60 fib. The weekly Stochastic triggered a mini pup bounce through the 20 band but is stagnating at the 40 band. The weekly market structure sell high (MSL) triggers on a breakdown below $47.68. The Daily Rifles chart attempts to reverse and break down as the 5-period MA down at $62.58 falls towards the 15-period MA at $60.47. The daily 50-period MA stands at $52.54. The daily stochastic has a mini inverse pup going through the 80 band. The daily weak market structure (MSL) buy triggered on the breakout at $39.50. The price level of $20.11 is the floor in cash per share. The daily lower Bollinger Bands (BB) lie at $27.69. Investors can use opportunistic exit levels from the $60.37 level to the $84.60 level to reduce or sell stocks. The MSH weekly trigger at $47.68 can act as a trap door trigger for the stock price if it breaks out. The daily MSL trigger of $39.50 can be used as a stop-loss level. Seasoned and nimble traders can look for a bounce off the low of $20.10 in cash per share.
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