Pfizer (PFE 0.05%) and Moderna (MRNA +1.62%) both have generated billions of dollars in revenue, thanks to their coronavirus vaccines. They both dominate the U.S. market.
Pfizer has fully vaccinated more than 127 million Americans, while Moderna has vaccinated nearly 77 million. But their stock prices haven't followed the same path. Since the start of the pandemic, Moderna's shares have soared more than 600%, while Pfizer's stock has gained about 45%.
When I ask, "which is the better COVID stock?" the answer might seem obvious. But actually, it isn't. There are reasons to like both of these vaccine giants. Let's take a closer look at each player and see which one really is the best stock to buy now.
Image source: Getty Images.
The case for Pfizer
Pfizer actually has an even broader coronavirus program than Moderna. That's because it makes a coronavirus vaccine -- Comirnaty -- to protect people from getting the virus. And it makes a coronavirus pill to treat the virus -- Paxlovid. Moderna only focuses on coronavirus prevention.
This year, Pfizer expects to bring in $32 billion in Comirnaty revenue and $22 billion in revenue from Paxlovid. Pfizer shares Comirnaty revenue with its biotech partner BioNTech -- but even considering that, Comirnaty is a major revenue driver for the big-pharma company.
Pfizer's vaccine benefits from a wider range of authorizations in the U.S. than any other coronavirus vaccine. The U.S. Food and Drug Administration (FDA) authorized the use of Comirnaty in children ages five through 15. Authorization grants temporary permission to use a product during an emergency -- such as the pandemic.
The FDA approved the vaccine in individuals ages 16 and older. The regulatory agency will meet to discuss possible authorization of Comirnaty in younger children on June 15.
NYSE: PFE
Key Data Points
Another big plus for Pfizer -- it doesn't depend on its coronavirus program for revenue. The company sells eight other blockbuster products. Some of these are set to lose patent protection later this decade, but Pfizer is preparing for that. The company has 96 candidates in the pipeline, and 29 are in phase 3 development.
Pfizer also has made acquisitions to beef up its product portfolio. An example is the recent purchase of Biohaven Pharmaceuticals, which gives it an approved migraine treatment and a portfolio of other assets.
The case for Moderna
Moderna expects to generate at least $21 billion in vaccine revenue this year, according to advance purchase agreements signed so far. The biotech company developed the mRNA technology used in its vaccine, so it holds full rights to the product. It doesn't have to share revenue with another company, and that's a big plus.
However, a weak spot for Moderna right now is the fact that it hasn't yet gained authorization for the use of its vaccine in children and teens. The FDA will discuss the possibility of authorizing for those groups during meetings on June 14 and 15.
Authorization would be great, but Moderna still has lost valuable time in these age groups. Parents have already brought their children in for vaccination -- and have received the Pfizer vaccine. If the experience was positive, they may opt for the same vaccine brand next time around
NASDAQ: MRNA
Key Data Points
Moderna's advantage is the breadth of its coronavirus vaccine program. The company is working on several boosters, including one that targets the omicron variant. It's also working on something that could be a big winner over the long term -- a combined coronavirus/flu vaccine candidate.
This program is in preclinical development, but Moderna aims to start clinical trials for the combined candidate this year. If the company is successful with a combined candidate, it may generate significant vaccine revenue over time. About half of the U.S. adult population went for a flu vaccine last year, so it's easy to imagine the same population eventually opting for a combined vaccine.
Right now, the coronavirus vaccine is Moderna's only commercialized product. But the company has 46 programs in development in a variety of therapeutic areas.
Pfizer or Moderna?
Pfizer and Moderna each have strengths in the coronavirus market, as I mentioned above. And they both have what it takes to continue generating significant revenue from their coronavirus products. Which stock is the better buy? It depends on your investment style.
Pfizer clearly is the safer play. The company has many commercialized products, so its stock price is less sensitive to coronavirus news. It also pays a dividend -- so investors can count on regular income. If you're a cautious investor, Pfizer is the best choice.
Investors who are more comfortable with risk may opt for Moderna. The biotech company offers more growth potential -- even if the stock doesn't soar as quickly as it did in the past. If Moderna wins in these later stages of the pandemic and into the endemic, billion-dollar revenue may continue. And that should fuel future waves of gains for this biotech stock.
