#12421
Re: Novavax (NVAX): Un Nuevo Comienzo
Valuaciones y escenarios. Redplate en IV. Poco más que añadir. Su análisis coincide en 2B-3B sin covid.
I was asked by Horcents how one might create a valuation model for the insanity that has/is happening with NVAX (and the world). So first I will reverse the question and ask ‘what was the pandemic worth to NVAX. That’s obvious it was worth infinity and beyond. At the news of NF ph3 success the company was crippled and almost unable to sufficiently finance their future to ever launch NF. Market response was tepid (15 fell back to 12) and their was wide spread fear of needing another raise or negotiate a weak deal with a pharma (they smell blood) and shareholders would be screwed at ‘maybe’ 15-20 bucks. And that was a tad shaky as they clearly needed money.
Then CoViD comes. And unlike SARS and Ebola and Zika it comes and it stays. And your company has existed for the very purpose of creating vaccines for emerging infectious diseases. Your technology was validated as best in class for an airborne lung disease transmission the same month that the 100 year pandemic, an airborne lung disease pathogen. Lightening strikes at the very moment that the technology was proven comes the challenge of a lifetime. So right place right time all that but remember this is the company’s mission statement. They have been saying ghost buster style ‘ we got this’. Ventman saying ‘trust me I’m a scientist’ and they cross the beams. This is what you bought, a chance at this golden ring. This isn’t an accident but it is entirely fortuitous
So three scenarios.
One they eff this CV thing up and don’t get a contract. Where are you? Well now NF to market and a facility to make it are both paid for. And maybe only half or less at shareholders and offerings at waaaay higher price that possible without CV. They can launch flu on money in the bank and they can own it. That alone makes them worth a lot more than before CV, even though they are only NF they are way better off. They may be able to launch an RSV ph3, but will need money to finish it.
Flu will run to 200 up to 400 million, they get a 5x of that market cap 2-3 billion. Not today’s price but way better than it would have been. And this is with CZv failure.
Second scenario
NVAX is one of a half dozen decent CV vaccines that get approved and sell 300m500m doses a year and make 50-100 cents profit/dose. (Low margin market value is going to be different than typical pharma margin valuations, but a 500m dollar profit plus 4-500m in sales for NF and easy this is a 10B enterprise And any upside from RSV is gravy, but still 3 years or more out. It will not add to valuation until proven. Market sees two ph3 fails. So until it reads out again, until then it’s a high risk high return, but it’s a gamble.
Any upside news and it’s up to 15B and maybe just maybe without much dilution.
Third scenario. Total win, best in class CV vaccine, contracts for 1.5 billion doses, and wave after wave of CV stays in our future. NF now bumps sales to 600-750m by way of a contact high (Name value). The name Now sells NF at premium prices and margins get better. There is no rational means to properly value the company that wins this race. some have asked what is the emotional value/name value for the winner? Don’t know. But it will run to an emotional price. But is that the Real value, the true value? A big number might happen but it won’t be sustained. It will settle ultimately to a P/E ratio ok’d school kind of number.
So I didn’t really answer but dodged around the top and bottom edges
I was asked by Horcents how one might create a valuation model for the insanity that has/is happening with NVAX (and the world). So first I will reverse the question and ask ‘what was the pandemic worth to NVAX. That’s obvious it was worth infinity and beyond. At the news of NF ph3 success the company was crippled and almost unable to sufficiently finance their future to ever launch NF. Market response was tepid (15 fell back to 12) and their was wide spread fear of needing another raise or negotiate a weak deal with a pharma (they smell blood) and shareholders would be screwed at ‘maybe’ 15-20 bucks. And that was a tad shaky as they clearly needed money.
Then CoViD comes. And unlike SARS and Ebola and Zika it comes and it stays. And your company has existed for the very purpose of creating vaccines for emerging infectious diseases. Your technology was validated as best in class for an airborne lung disease transmission the same month that the 100 year pandemic, an airborne lung disease pathogen. Lightening strikes at the very moment that the technology was proven comes the challenge of a lifetime. So right place right time all that but remember this is the company’s mission statement. They have been saying ghost buster style ‘ we got this’. Ventman saying ‘trust me I’m a scientist’ and they cross the beams. This is what you bought, a chance at this golden ring. This isn’t an accident but it is entirely fortuitous
So three scenarios.
One they eff this CV thing up and don’t get a contract. Where are you? Well now NF to market and a facility to make it are both paid for. And maybe only half or less at shareholders and offerings at waaaay higher price that possible without CV. They can launch flu on money in the bank and they can own it. That alone makes them worth a lot more than before CV, even though they are only NF they are way better off. They may be able to launch an RSV ph3, but will need money to finish it.
Flu will run to 200 up to 400 million, they get a 5x of that market cap 2-3 billion. Not today’s price but way better than it would have been. And this is with CZv failure.
Second scenario
NVAX is one of a half dozen decent CV vaccines that get approved and sell 300m500m doses a year and make 50-100 cents profit/dose. (Low margin market value is going to be different than typical pharma margin valuations, but a 500m dollar profit plus 4-500m in sales for NF and easy this is a 10B enterprise And any upside from RSV is gravy, but still 3 years or more out. It will not add to valuation until proven. Market sees two ph3 fails. So until it reads out again, until then it’s a high risk high return, but it’s a gamble.
Any upside news and it’s up to 15B and maybe just maybe without much dilution.
Third scenario. Total win, best in class CV vaccine, contracts for 1.5 billion doses, and wave after wave of CV stays in our future. NF now bumps sales to 600-750m by way of a contact high (Name value). The name Now sells NF at premium prices and margins get better. There is no rational means to properly value the company that wins this race. some have asked what is the emotional value/name value for the winner? Don’t know. But it will run to an emotional price. But is that the Real value, the true value? A big number might happen but it won’t be sustained. It will settle ultimately to a P/E ratio ok’d school kind of number.
So I didn’t really answer but dodged around the top and bottom edges
