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After BioNTech reported its November results, we updated our fair value. We changed our rating from Watch to Avoid. We have added the shift toward combining cancer treatments with antibody-drug conjugates to what we track. We also added the emergence of the drug Pumitamig as the main driver of the company's future growth after a different key cancer vaccine failed its late-stage trial.
Morgan Stanley, UBS, Wells Fargo, and Evercore ISI all maintained their positive ratings on the stock this week. While the average analyst price target sits at about $120, these firms are signaling that the company's pivot toward cancer treatments remains on track despite the decline in COVID-19 vaccine revenue.
For a long-term owner, this shows that the big Wall Street firms still believe in the company's ability to use its large cash pile to build a new business in oncology. The stock currently trades well below that average target, reflecting the high risks involved in clinical drug trials.
Source: UBS
BioNTech brought in about 1.46 billion dollars in revenue this quarter, which was higher than the 1.17 billion dollars analysts expected. The company also earned about 83 cents per share, beating the 76-cent estimate. This performance allowed management to raise the midpoint of its full-year sales guidance to roughly 1.8 billion dollars.
While COVID-19 vaccine sales still provide a floor, the real story is the progress in oncology. The company shared new data for its lead cancer candidate, Pumitamig, and launched a new late-stage trial for breast cancer. With over 16 billion dollars in cash, the company has the resources to fund these expensive trials for years as it tries to prove its mRNA technology can treat tumors as effectively as it prevented viruses.
See the full quarter, and how our tracked metrics did
Source: Company earnings report
BioNTech and its partner DualityBio reported that their experimental drug, trastuzumab pamirtecan, met its main goal in a large study of patients with a specific type of metastatic breast cancer. The drug helped patients stay alive longer without their cancer progressing compared to standard chemotherapy.
This is a win for the company's oncology pipeline, though the improvement was described as modest. It adds another potential product to the portfolio as the company tries to move beyond its reliance on COVID-19 vaccines. The next step will be sharing more detailed data to see if the benefit is large enough to change how doctors treat this form of cancer.
Source: GlobeNewsWire
BioNTech announced that its BNT113 vaccine did not meet the main goal of its clinical trial, which was to significantly extend the time patients lived without their cancer getting worse. The study focused on patients with a specific type of head and neck cancer.
This failure is a reminder of the high risks in drug development, especially as the company pivots its entire future to oncology. While BioNTech has many other drugs in testing, this setback for its mRNA platform in solid tumors is why the stock can be volatile. It underscores why the company is now focusing more on combination treatments rather than using vaccines alone.
Source: GlobeNewsWire
Management has a history of setting conservative targets and clearing them, but recent results show a business that is difficult to predict as it moves away from its vaccine roots.
| Expectation | |
|---|---|
| EPS | $-1.76 |
| Revenue | $445M |