Please ensure Javascript is enabled for purposes of website accessibility

The Best News and Worst News from BioNTech's Q1 Results

By Keith Speights and Brian Orelli, PhD - Updated Jun 28, 2021 at 8:33AM

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

The good far outweighed the bad.

BioNTech (BNTX -1.51%) recently reported its first-quarter results. In this Motley Fool Live video recorded on May 12, 2021, Motley Fool contributors Keith Speights and Brian Orelli discuss the best news and the worst news from the German biotech's quarterly update.

Keith Speights: We're going to switch to another vaccine maker, BioNTech, a German partner of Pfizer. BioNTech announced its first-quarter results on Monday. There are always a lot of numbers with any company's quarterly update, but what would you say were the best news and the worst news with BioNTech's Q1 results?

Brian Orelli: The best news is obviously the revenue, which was €2.5 billion, that's about $2.5 billion. It was up nearly 7,300 percent. But that's a silly comparison because you're comparing collaboration revenue in the year-ago to sales of its vaccine this quarter. So [laughs] 7,300 percent is nothing to be shy about. Most of the revenue was BioNTech's share of the gross profit from COVID-19 sales in Pfizer's territories, as well as sales milestone payments from Pfizer. They also made a little from sales in territories that are not covered under the agreement.

In terms of worse news, I think it's probably the cash situation. Despite making €1.1 billion in net income, the company actually ended the first quarter with less cash and equivalents than it did at the end of 2020. They had about €890 million versus €1.2 billion at the end of the year. It seems like they're spending on infrastructure. They're setting up a manufacturing facility in Singapore.

Investors, I don't think should be too worried about it. They have contracts for 1.8 billion doses and they've only delivered 450 million of those. They are still going to generate plenty of cash. Then as we've said, they're probably going to get more contracts for 2022 and even into 2023, so they're going to continue to generate cash and putting that money to good work.

Speights: I would expect BioNTech will report some other gaudy numbers, flashy numbers in the next few quarters as well, and some growth in the thousands of percentage points. You are right that the bad news probably was the decline in cash, but this company is going to make a lot more money over the next couple of years with its vaccine. I think the real question for BioNTech will be, how does it pivot from here?

I know the company is wanting to reinvest some of this cash that it's making from the COVID vaccine into other programs. I think the real question that will be for BioNTech, can it leverage this success and have some other candidates come forward?

Orelli: It almost needs some cash cushion to be able to do it. If we assume that COVID vaccines are going to wane at some point, that they're not going to be making billions of dollars per quarter. I think that if that's the case, then they probably need to get a stockpile of cash at some point, but they have a few quarters to worry about that.

Brian Orelli, PhD has no position in any of the stocks mentioned. 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
$160.02 (-1.51%) $-2.46
Pfizer Inc. Stock Quote
Pfizer Inc.
$49.63 (-0.24%) $0.12

*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 08/16/2022.

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.