Novavax (NVAX -5.62%) and Moderna (MRNA -4.33%) are two of the biotech industry's biggest success stories from the coronavirus vaccine race. While Moderna's market cap of around $104 billion makes Novavax's $12.6 billion look tiny, that may soon change.

With Novavax's jab racking up approval after approval in recent weeks, revenue will soon start to flood in, just as it did for Moderna. Is Moderna's growth story approaching a plateau just as Novavax is starting its ascent with gusto, or will Moderna manage to increase its momentum? To get a sense of what the answer to that question might be, let's look at the case for each stock.

A worker in full PPE holds a vaccine-filled syringe while writing in a notepad.

Image source: Getty Images.

Four reasons Novavax stock might beat Moderna this year

Taylor Carmichael (Novavax): The fight against COVID has made Novavax and Moderna two of the most outstanding investments in the stock market over the last two years. Novavax -- which started off 2020 as a micro-cap -- outshone the entire stock market in the first year of COVID, with that amazing 3,000% run. But Moderna's been no slouch, as a 12-bagger since the beginning of 2020:

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Which of these two vaccine biotechs will win out in 2022? My money's on Novavax (literally). I can think of at least four reasons the smaller biotech is likely to outperform.

One, the stock is downright cheap right now. Novavax sports a forward price-to-earnings (P/E) ratio of 3.39, while Moderna is three times as expensive at a P/E of 10.63. I expect these ratios to come into alignment once Novavax starts shipping 2 billion doses of the COVID vaccine this year.

Two, investors have a pretty good idea what's been suppressing the stock -- manufacturing delays. Novavax's vaccine candidate had outstanding results in phase 3 trials. Some observers have called it best-in-class. But the stock's been hammered while Novavax has tried to scale up manufacturing while assuring regulators that the vaccine doses from the plants are just as pure as the ones used in clinical trials. That's why Novavax's emergency use authorizations have been delayed during 2021. Now, authorities around the world are signing off on its vaccine candidate. Novavax expects to file with the Food and Drug Administration this week. As the biotech ships more and more vaccine doses out into the world, the stock will resume its epic run upward.

Three, Novavax might win a lot of fans in the booster market. The first-round mRNA vaccines are highly safe (definitely safer than staying unvaccinated). Nonetheless, there's a tiny risk that an mRNA booster in young people might cause heart inflammation, specifically myocarditis and pericarditis. The Novavax vaccine doesn't seem to have this risk and might win market share on this basis alone.

Finally, Novavax has a commanding lead over Moderna in flu vaccines. This gives the smaller biotech an advantage in the race to find an influenza-COVID combination vaccine. Novavax has already initiated a phase 1/2 trial for its combo vaccine candidate; results are expected in the first half of 2022. So while there are short-term catalysts that will drive Novavax stock higher in 2022, investors should pay close attention to the race for the combo shot. Whoever wins that race will be in the catbird seat over the next decade.

Rising sales and deepening global market penetration bode well for shareholders

Alex Carchidi (Moderna): Among vaccine stocks, Moderna has three major things in its favor: accelerating sales of its coronavirus shot (now known as Spikevax), ambitious projects rapidly taking shape, and an appealing valuation.

In 2022, Moderna expects to make between $17 billion and $22 billion in revenue from Spikevax. That's vastly more than its trailing revenue of $11.8 billion, and the global market for coronavirus vaccines is still quite far from being saturated. And at present, Moderna's jab is approved on an emergency or conditional basis in 68 countries, which makes it perfectly positioned to maintain the rapid pace of its rollout.

Among upcoming catalysts, investors can expect the announcement of more purchase orders for Spikevax. On Dec. 27, South Korea added 20 million doses to its existing supply agreement with the company; the doses are set to be delivered in the second half of 2022.

Beyond that, Moderna's goal to create a continuously updated pan-respiratory virus vaccine could yield a product so valuable that it makes the sales of Spikevax so far look like small potatoes.

Moderna's valuation is also quite favorable. Its price-to-sales ratio is around 9.18, which is slightly lower than Novavax's 9.95. And Moderna's trailing price to earnings (P/E) multiple is a healthy 15.77, which indicates that it isn't anywhere near being overvalued. In fact, given that the market's average P/E is near 30, the stock could even be seen as trading at a bargain.

It could make sense to buy shares of both companies

Novavax's vaccine rollout is slightly behind Moderna's, which means that its stock could appreciate more in the next few quarters as sales figures get reported. On the other hand, Moderna's lead could accelerate if it can continue to quickly penetrate the markets where its shots are already approved. And both companies have pipelines packed with highly promising projects which could power long-term growth.

Investors who prefer a cheaper valuation might want to buy Moderna, whereas those who are more interested in the prospect of rapid growth in the short term might be better served by Novavax.