MRNA: change the open Neutral view to Bearish
Thesis. The cancer vaccine catalyst has now played out, and the stock still prices in more than the data supports. Moderna and Merck presented the full Phase 3 INTerpath-001 results for intismeran autogene at ESMO, a few days early because of an embargo breach. The combination cut the risk of melanoma recurrence or death by 42% versus Keytruda alone. RBC Capital Markets said the effect is weaker than the Phase 2 result, with more side effects. RBC also noted that existing immunotherapies may reach similar benefit at lower cost. Citi asked whether the gain justifies harvesting each patient's tumor and making a custom product.
MRNA trades near $189, a market cap of about $80B, up from a 52-week low of $22.28. TD Cowen models $3.4B in peak intismeran revenue and has a $90 target. Citi rates the stock Sell with an $80 target. TipRanks puts the average Street target at $118, about 40% below the current price. The stock kept falling after the full presentation, which suggests the retail buyers who bid it up are leaving. The 2027 FDA approval RBC expects is too far away to support the price in the meantime.
Structure. Implied volatility is 86%, at the 82nd percentile of the past year, so buying puts outright is expensive. The 190/130 put spread pays for part of that premium by selling the lower strike. March 2027 gives about five months, which covers the November 6 earnings report and the period after the conference. Most of the full $60 width is captured at the Street average target.
Main risk. A short squeeze or a new readout in another tumor type, such as lung cancer, could bring momentum buyers back fast. The stock nearly tripled in one session in August. Q3 earnings on November 6 (before the open) are a near-term event, with liquidity rated 3 out of 5 and a beta of 1.14. Upside on the spread stops below $130, and the most you can lose is the debit paid.