Please ensure Javascript is enabled for purposes of website accessibility

Why BioNTech Stock Jumped Today

By Keith Speights – Jul 21, 2020 at 3:03PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Monday's momentum carried over into Tuesday and was more than enough to offset the impact of a secondary stock offering.

What happened

Shares of BioNTech (BNTX 2.08%) were jumping 4.7% higher as of 2:52 p.m. EDT on Tuesday after rising as much as 10.9% earlier in the day. The gain appears to be the result of continued momentum from Monday's news. BioNTech and Pfizer (PFE 0.59%) announced positive preliminary results from early-stage testing of COVID-19 vaccine candidate BNT162b1 yesterday. The partners also announced a deal to supply 30 million doses of their COVID-19 vaccine candidate to the United Kingdom pending success in clinical testing and regulatory approval.

BioNTech is taking advantage of this momentum. The German biotech announced Tuesday morning that it plans to offer 5 million American Depositary Shares (ADS) in a public stock offering.

Gloved hands holding bottles labeled coronavirus vaccine.

Image source: Getty Images.

So what

Normally, secondary stock offerings cause share prices to fall rather than move higher. The dilution resulting from the offerings reduces the value of existing shares. The fact that this didn't happen for BioNTech underscores just how much potential investors see for the company's COVID-19 vaccine candidates.

Experts are looking for three key things with experimental COVID-19 vaccines: neutralizing antibody production, T-cell response, and an acceptable safety profile. BioNTech and Pfizer delivered on all three fronts with the results they announced yesterday for BNT162b1, the most advanced of several COVID-19 vaccine candidates the two companies are evaluating.

Those were only early-stage results in a small number of participants, though. It remains to be seen whether the BNT162 program produces positive results in larger, late-stage studies.

Now what

The good news is that investors shouldn't have to wait very long to find out how safe and effective BioNTech's COVID-19 vaccine candidate will be in late-stage testing. BioNTech and Pfizer hope to begin a phase 2b/3 clinical trial including up to 30,000 participants later this month pending regulatory approval. The German biotech stock will almost certainly have an even bigger catalyst on the way if this study goes well.

Keith Speights owns shares of Pfizer. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

BioNTech SE Stock Quote
BioNTech SE
$130.30 (2.08%) $2.65
Pfizer Inc. Stock Quote
Pfizer Inc.
$44.09 (0.59%) $0.26

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/27/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.