Shares of BioNTech (NASDAQ:BNTX) were slumping 7.5% lower as of 3:35 p.m. EST on Thursday. This decline might seem surprising considering the good news the company and its partner Pfizer (NYSE:PFE) reported this week. This news notably includes positive efficacy results for coronavirus vaccine candidate BNT162b2 and a supply agreement with the European Union for 200 million doses of the vaccine.
Why did the German biotech stock sink? The most likely reason is old-fashioned profit-taking. BioNTech skyrocketed close to 20% in three days after the interim efficacy results were announced for BNT162b2. It's tempting for investors to take profits off the table with a sharp, quick gain like that.
The best thing for long-term investors to do when a stock they own tumbles due to others taking profits is... absolutely nothing. Selling too soon is oftentimes the worst mistake an investor can make.
BioNTech's growth prospects remain very good even after its huge gains this week. Assuming BNT162b2 wins Emergency Use Authorization (EUA) in the U.S. and approvals in other major countries, BioNTech and Pfizer are poised to make billions of dollars from the COVID-19 vaccine.
All signs right now point to the likelihood of the need for COVID-19 vaccination on a yearly basis. If so, BioNTech could be on track for a significant recurring revenue stream.
BioNTech and Pfizer should have enough safety data to file for EUA in the U.S. for BNT162b2 within the next week or so. CEO Ugur Sahin said in BioNTech's third-quarter earnings press release, "We believe the prospects for the company have never been brighter." If the safety profile for BNT162b2 looks good, Sahin could be proven right.
Editor's note: A previous version of this article incorrectly stated that BioNTech stock jumped 50% this week. The actual increase was close to 20%. The Fool regrets the error.