Novavax (NASDAQ:NVAX) has jumped from a price of $4 a share back in January to $128 a share in December. That's a huge 3,000% gain for early investors. Is now a good time to buy Novavax?

The answer is absolutely -- if the company's COVID-19 vaccine has positive data from one of its pivotal trials. And I'd say, not at these prices, if the company reports unhappy news.

Businessman holding a small bull and a small bear.

Image source: Getty Images.

Right now, the stock price is at the mercy of the company's COVID-19 vaccine. If Novavax reports 90% efficacy levels, the sky's the limit. At an $8 billion market cap, the stock could easily triple to $24 billion (still under the market cap of BioNTech). And some bulls might wonder why Novavax isn't as valuable as Moderna ($62 billion).

The market opportunity for a COVID-19 vaccine is surreal. Operation Warp Speed paid $1.6 billion to obtain 100 million doses of Novavax's vaccine, pricing the drug at $16 a dose. This is a two-shot regimen, so that's only enough to vaccinate 50 million people. The price tag might be higher or lower, depending on many factors, but $16 a dose is a good starting point for a back-of-the-napkin calculation.

Novavax has agreements in place to manufacture over 2 billion doses. At a price point of $16 a dose, that's $32 billion in potential revenue in 2021. The upside is incredible. And we still don't know if a COVID-19 vaccine will be a one-time event (like for the mumps) or an annual ritual (like with the flu shot).

This stock will be volatile over the next several months. Positive data will send shares soaring higher. But if the vaccine doesn't work? Look out below. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.