Moderna Loses Top Spot on S&P 500 After Weakened Vaccine Outlook

(Bloomberg) — Moderna Inc. plunged Thursday, briefly losing its place as the best performing stock on the S&P 500 Index.

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The biotech’s stock closed down 18%, the biggest daily drop since March 2020, after a weakened outlook for its Covid-19 vaccine and sales that missed the average analyst estimate. For a few minutes the vaccine maker was supplanted by shale oil producer Devon Energy Corp., before finishing the day back in the lead.

The U.K.’s approval of Merck & Co.’s Covid-19 antiviral pill also hit Moderna’s shares. British regulators described the treatment as safe and effective and more authorizations could hurt the sales of Covid vaccines.

The drugmaker’s meteoric rally earlier this year led to its addition into the benchmark S&P 500 in July after its coronavirus inoculation received emergency authorization in the U.S. in December, a week behind the first approval for Pfizer Inc. and BioNTech SE’s vaccine. But concerns about the future sales have weighed on the shares. Moderna has slumped more than 40% since a peak in August.

“Shares remain substantially overvalued,” wrote SVB Leerink analyst Mani Foroohar in a research note. The market for Covid vaccines is transitioning to “a much smaller, much more competitive chronic endemic market,” he added.

Ten analysts covering Moderna have either a hold or sell recommendation with only seven suggesting investors buy the stock, data compiled by Bloomberg show. Its shares are still up roughly 172% this year.

(Updates with closing prices.)

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