What happened
Shares of Novavax (NVAX 0.56%) were sinking 15.1% this week as of the market close on Thursday, based on data from S&P Global Market Intelligence. The only news from the company in recent days was an announcement that its CEO, Stanley Erck, will participate in the virtual J. P. Morgan Healthcare Conference on Jan. 10.
This obviously wasn't the reason behind the vaccine stock declining so much. Instead, investors seem to be less enthusiastic about Novavax's prospects. This lower optimism likely is the result of anticipation that the current surge in COVID-19 cases due to the omicron variant could be the beginning of the end of the pandemic.
Image source: Getty Images.
So what
It's certainly possible that there could be a light at the end of the tunnel with respect to COVID-19. Although coronavirus infections are rising with the spread of the omicron variant, the cases appear to be milder and with lower hospitalization rates than seen with previous variants.
However, the demand for Novavax's COVID-19 vaccine won't necessarily be lower in this scenario. The company is already committed to supplying up to 200 million doses to European Union countries and 1.1 billion doses (along with its partner, Serum Institute of India) to the COVAX Facility. Novavax also has supply deals with other countries, including the U.S., pending regulatory authorization. The company could still be a winner over the next few years if the pandemic becomes endemic.
Now what
Novavax's share price has fallen in recent weeks despite several positive regulatory announcements. Perhaps the stock will rebound if the company wins U.S. Emergency Use Authorization (EUA) for its COVID-19 vaccine. That EUA filing, though, is still a few weeks away.
