Shares of Novavax (NVAX -1.17%) were tumbling 5.5% lower as of 12:17 p.m. EDT on Wednesday after falling as much as 8.8% earlier in the day. The stock soared in after-hours trading on Tuesday on President Biden's public comment that Novavax could soon win emergency use authorization (EUA) for its COVID-19 vaccine. So why are shares sinking today?
It's probably simply that some investors are taking profits off the table. The biotech stock soared more than 130% year to date and nearly 39% so far this month as of the Tuesday market close.
The best thing to do if you own a stock that falls with no apparent negative news is... nothing. That's especially the case with Novavax, with the company potentially drawing close to EUAs for its COVID-19 vaccine.
President Biden singled out the biotech in his remarks on Tuesday about sending vaccines to India. He stated, "The problem is right now we will have to make sure we have other vaccines like Novavax and others coming on, probably, and I think we'll be in a position to be able to share vaccines as well as knowhow with other countries who are in real need."
These comments seem to indicate that the U.S. government thinks that EUA for Novavax's COVID-19 vaccine is likely. Based on the high efficacy and solid safety profile seen in the clinical results that Novavax has already announced, the company's prospects of winning authorization certainly appear to be quite good.
Novavax hasn't won any EUAs for its COVID-19 vaccine yet. However, that could change in the near future. While an EUA is obviously the biggest potential catalyst to look forward to, it's also possible that the company could secure additional supply deals over the next few months.