You might not expect a stock that gained 2,600% last year to be this year's success story, too. But in the case of Novavax (NASDAQ:NVAX), a lasting winning streak is very realistic. Novavax started 2020 as a clinical-stage company with an investigational flu vaccine in phase 3 trials -- and a share price of less than $4. Then, its launch of a coronavirus vaccine program and positive trial results from the flu vaccine candidate sent the shares soaring.

The U.S. Food and Drug Administration (FDA) recently granted an Emergency Use Authorization (EUA) to Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA) for their coronavirus vaccines. These companies have already begun distributing the vaccines, and therefore are generating revenue from them. So, you might wonder why Novavax -- still involved in clinical trials -- is my favorite vaccine stock for 2021. Let's take a closer look.

A researcher's hand holds a vial of coronavirus vaccine against a gold and purple background.

Image source: Getty Images.

Early first-quarter results

Novavax is studying its vaccine candidate in two phase 3 trials. One is based in the U.K. The company expects interim results from that trial as soon as early in the first quarter of this year. This will serve as a basis for emergency use requests in various countries. Novavax recently started a second phase 3 trial in the U.S. and Mexico; results from this trial, as well as a phase 2b trial in South Africa, will add to data to support a request for full approval.

Data so far has been promising. Results from phase 1 showed the vaccine candidate was well tolerated and generated immune responses. It produced neutralizing antibody responses higher than those found in recovered coronavirus patients. These antibodies are key because their role is to block infection.

For EUA consideration, Novavax's vaccine must show at least 50% efficacy in the phase 3 trial. However, if it hopes to become a leader in the market, it will have to do better than that. Pfizer's and Moderna's vaccines showed 95% and more than 94% efficacy, respectively, in their phase 3 trials.

Novavax's vaccine efficacy still remains an unknown -- and therefore a risk. But more on that later. Let's move along to logistics and potential revenue.

Easier to manage

Novavax's vaccine candidate can be stored at standard refrigerator temperatures. That makes it an easier to manage and less expensive option than Pfizer's vaccine for potential users. Pfizer's requirement of ultra-low temperatures means many hospital systems have had to order special freezers to store the product. If Novavax's efficacy and safety match that of Pfizer, it clearly will have the edge from a logistics perspective.

As for revenue, an authorization would be big news for Novavax. The company would transition from zero product revenue to billions in a short period of time. Novavax hasn't announced one specific price for its vaccine, but we can take a look at the price the U.S. is paying for existing vaccines as a guide. That amounts to $16 a dose. So far, Novavax has orders for about 300 million doses of vaccine. This includes the U.S. order. All of these orders represent $4.8 billion in sales.

And that sales number could easily move higher; Novavax is ramping up capacity to produce as many as 2 billion doses by the middle of this year. Pfizer's maximum capacity is 1.3 billion doses this year, while Moderna aims to produce a billion. So Novavax has an edge over both companies when it comes to ability to fill orders.

If the FDA authorizes Novavax's investigational vaccine, the company's earnings outlook is even stronger than that of Moderna. Earnings per share estimates for the current fiscal year are more than $21. That's compared to about $10 a share for Moderna.

NVAX Chart

NVAX data by YCharts

The possibility of two products

And finally, Novavax offers the possibility of two marketed products in the coming year or so. First, of course, I'm referring to the coronavirus vaccine candidate. Second, there's NanoFlu. The company assembled a team recently to carry the investigational flu vaccine through the regulatory process to licensure. NanoFlu met all primary endpoints in its phase 3 trial last year, so there is reason to be optimistic about the regulatory outcome.

Novavax has the ability to become a market leader. Its vaccine candidate is easy to distribute, and the company beats rivals when it comes to capacity. The possibility of a flu vaccine approval is another plus. One more piece of positive news for farther down the road: Novavax is exploring the possibility of a combined flu/coronavirus vaccine for post-pandemic use. That could be a game-changer.

Still, as promising as all of this sounds, Novavax remains a risky investment. If coronavirus vaccine trial data disappoints, the shares could plunge. So only aggressive investors should consider buying this biotech stock. If the data is strong, though, Novavax could deliver another winning year for investors.

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.