Tiny Novavax (NVAX 9.11%) has emerged as one of the strongest stocks in the first six months of 2020, running up an astounding 2,300%. Most of that surge has been due to excitement about NVX-CoV2373, the company's COVID-19 vaccine candidate. Here are three reasons why the market has been so bullish about Novavax in 2020.

COVID-19 vaccine in gloved hand

Image source: Getty Images

1. Major financial support from major outsiders

Back in May, the global nonprofit Coalition for Epidemic Preparedness Innovations invested $388 million in Novavax's vaccine candidate for COVID-19. Last week, the U.S. government agreed to pay the company $1.6 billion through Operation Warp Speed to help develop it. With almost $2 billion of free money in the bank, Novavax can now easily compete with all the big pharmaceutical players. And at a market cap of under $6 billion, it's trading at less than three times its cash.

2. Better immunogenicity than rival candidates (so far)

In animal models, Novavax's vaccine is producing far more antibodies than any other candidate. And it's not even close. "We are seeing neutralizing titers in the 10,000 range in non-human primates," Gregory Glenn, president of research and development at Novavax said. AstraZeneca and Oxford University are reporting neutralizing antibody titers of around 40 in animal studies, while Sinovac reported neutralizing antibody titers up to 60 in animals. 

3. Novavax has arguably the best flu vaccine

Novavax has proven that its vaccine platform works with NanoFlu, its influenza vaccine candidate that has zoomed through clinical trials, defeating the market-leading vaccine from Sanofi in head-to-head trials. 

With $2 billion in cash and a strong vaccine platform, it might be the odds-on favorite right now.