What happened

Somewhat of an outlier coronavirus stock, Ocugen (NASDAQ:OCGN) see-sawed in price on Monday. That followed a new analyst recommendation, which although very bullish, likely gave investors pause to think about the company's prospects.

So what

Noble Capital analyst Robert LeBoyer initiated coverage of the stock with an unhesitant outperform (i.e., buy) recommendation. He also placed a $15 per share target price on the stock, which is more than double the level the shares closed at on Friday.

Child getting a shot from a medical professional.

Image source: Getty Images.

Like many Ocugen bulls, LeBoyer is most excited about Covaxin. This is the coronavirus vaccine candidate currently being developed by Bharat Biotech, the American company's partner in India, in collaboration with the Indian Council of Medical Research-National Institute of Virology.

As with the coronavirus vaccines that have been authorized by regulators in various jurisdictions across the world, Covaxin has demonstrated high efficacy in phase 3 testing, particularly in severe cases.

Ocugen holds the exclusive commercial rights to Covaxin in the U.S., so if the drug comes to market and is immediately deployed to fight the disease, LeBoyer's rosy view of Ocugen's future could be realized.

Now what

As always with biotech stocks, the key word is "if." Per the recommendation of the Food and Drug Administration, Ocugen will seek full Biologics License Approval (BLA) for Covaxin, rather than the originally planned Emergency Use Authorization (EUA). The BLA process is longer and more involved, so Covaxin might take quite some time to reach the market. Perhaps investors noted this sobering reality after being hit with the euphoria of the new analysis.

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.