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Why BioNTech, Moderna, and Novavax Stocks Are Jumping Today

By Keith Speights – Dec 13, 2021 at 11:12AM

Key Points

  • The U.K. is bracing for a potential "tidal wave" due to the omicron variant.
  • An Israeli study found that a third dose of the Pfizer-BioNTech vaccine is effective against omicron.
  • Novavax filed for authorization of its vaccine in the UAE and is on track for a U.S. filing by year-end.

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Concerns about the omicron variant as well as some good news are helping drive these vaccine stocks higher.

What happened

Shares of several leading COVID-19 vaccine makers were jumping as of 10:44 a.m. ET on Monday. BioNTech (BNTX 1.63%) stock was up 6.2%. Shares of Moderna (MRNA 4.16%) were rising 5.7% higher. Novavax (NVAX 5.16%) stock was trailing not too far behind, with a 3.8% gain.

There was one common denominator behind the rise of these vaccine stocks. On Sunday, United Kingdom Prime Minister Boris Johnson warned that a "tidal wave" of COVID-19 cases in the country stemming from the omicron variant could be on the way. The U.K. is accelerating its booster program. Investors could be anticipating that other countries could be on a similar path.

In addition, two of the vaccine makers had other news that helped fuel their gains. Results from an Israeli study announced on Saturday appeared to confirm that a third shot of the COVID-19 vaccine developed by BioNTech and Pfizer (PFE 1.04%) could provide significant protection from the omicron variant. BioNTech and Pfizer announced laboratory study results last week that showed similar findings.

Novavax announced on Monday morning that it has filed for emergency use of its COVID-19 vaccine in the United Arab Emirates. The company also stated that it remains on track to file for U.S. Emergency Use Authorization (EUA) by the end of this month.

A healthcare professional giving a shot to a person.

Image source: Getty Images.

So what

The greater the fears are about the omicron variant, the higher these stocks are likely to go. That's especially the case if there are solid reasons to expect that the companies will secure additional deals to supply more doses of their respective COVID-19 vaccines.

At this point, though, it's uncertain whether or not any of the vaccine makers will actually sell more doses as a result of the omicron variant. No one knows just how bad the new coronavirus strain will be, although it makes sense for countries such as the U.K. to brace for the worst.

In one way, the Israeli study data isn't helpful to BioNTech's and Pfizer's hopes to sell more doses of their vaccine. If a third booster wasn't very effective against the omicron variant, the prospects for a new vaccine version specifically targeting the variant would be significantly higher. This would likely be a more lucrative scenario for the companies, especially if two doses were required with the new vaccine version.

As for Novavax's news, the potential for winning emergency authorization in the United Arab Emirates wouldn't move the needle all that much for the company. However, investors are almost certainly feeling better that the U.S. EUA filing will be on schedule with Novavax confirming their anticipated submission yet again.

Now what

The main thing for investors to watch with all of these companies is whether or not they land additional supply deals. Until there's money on the table, the up-and-down swings related to the omicron variant merely reflect speculation. 

Of the three stocks, Novavax has the most potential catalysts over the near term. The company awaits regulatory authorizations and approvals in multiple countries. It also has the important U.S. EUA filing on the way.

Keith Speights owns Pfizer. The Motley Fool recommends Moderna Inc. The Motley Fool has a disclosure policy.

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