Please ensure Javascript is enabled for purposes of website accessibility

Why Inovio Pharmaceuticals Stock Perked Up in May

By George Budwell - Jun 6, 2021 at 12:15PM

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 biotech's pan-COVID-19 vaccine caught the eye of investors last month.

What happened

Shares of the clinical-stage biotech Inovio Pharmaceuticals (INO 6.91%) gained a respectable 10.9% over the course of May, according to data provided by S&P Global Market Intelligence. The DNA vaccine company's shares rallied last month on the news that its pan-COVID-19 vaccine candidate, INO-4802, showed strong signs of efficacy across multiple strains of the virus in preclinical studies.

So what

Despite being one of the first American biotech companies to develop a COVID-19 vaccine candidate last year, Inovio has fallen woefully behind the leaders in the space over the last year. In fact, there probably won't be a significant need for another vaccine in the U.S. by the time Inovio pushes its lead COVID-19 vaccine candidate, INO-4800, into late-stage testing this summer. 

A female researcher inspecting vials of COVID-19 vaccine.

Image source: Getty Images.

A pan-COVID-19 vaccine, however, may still serve a purpose in the fight against this global pandemic. Investors, in turn, appear to be betting that the company may yet derive a relatively healthy revenue stream from its COVID-19 vaccine platform. 

Now what

Is Inovio's stock worth buying after last month's double-digit uptick? Although the biotech exited the first quarter of 2021 with over $500 million in cash, Inovio's future remains murky at best.

The company's lead product candidate, VGX-3100 for precancerous cervical dysplasia caused by high-risk HPV 16/18, needs a strong showing in its upcoming confirmatory phase 3 trial readout. What's more, there's no way to predict how the second-tier COVID-19 vaccine market will shape up over the next two years.

In short, Inovio's stock doesn't sport a particularly compelling investing thesis as things stand now. 

George Budwell has no position in any of the stocks mentioned. 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

Inovio Pharmaceuticals, Inc. Stock Quote
Inovio Pharmaceuticals, Inc.
$2.63 (6.91%) $0.17

*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 08/14/2022.

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.