Shares of Novavax (NVAX 4.95%) were sinking 11.9% as of 10:27 a.m. ET on Tuesday after plunging as much as 21.6% earlier in the morning. Investors reacted negatively to the company's first-quarter results announced after market close on Monday.
Novavax reported Q1 revenue of $704 million, up 57% year over year. However, the consensus estimate was for revenue of $845 million.
The company posted its first profitable quarter ever, with Q1 earnings of $203 million, or $2.56 per share. But the average Wall Street estimate was for earnings of $2.69 per share.
Anytime a company misses analysts' top- and bottom-line estimates, its shares will almost inevitably fall. However, there's also another concern for investors with Novavax's Q1 update.
The vaccine maker reaffirmed its full-year 2022 revenue guidance of between $4 billion and $5 billion. But in Novavax's Q1 conference call, management acknowledged that this range assumes the delivery of doses of the company's NVX-Cov2373 COVID-19 vaccine to Gavi (the Vaccine Alliance) for distribution to low- and middle-income countries.
This is problematic for a couple of reasons. First, Gavi hasn't ordered any doses so far. Second, Novavax's management stated that Gavi intends to revise the volume and timing of any future orders. Depending on the extent of these revisions, Novavax's full-year revenue guidance could be in jeopardy.
Despite this uncertainty, investors can look forward to potential catalysts for the vaccine stock over the near term. Most importantly, the U.S. Food and Drug Administration scheduled a meeting for an advisory committee to review Novavax's Emergency Use Authorization filing for NVX-CoV2373 on June 7, 2022. This meeting could pave the way for the vaccine to enter the U.S. market, at long last.