Volatile Week For Coronavirus Stocks: COVID Vaccines Are In Focus

By Rod Raynovitch of Raygent.com
Sunday, June 28, 2020 1:41 PM EDT

Friday was a risk-off day for biotech stocks as the XBI took a 3.28% hit on profit taking and concerns that the pandemic could drag on through the summer. Regional spikes in virus cases in Arizona, Florida an Texas raised concerns about the “V shaped economic recovery” model.  All the major indices were down about about 2.4% for the day. Peak prices were hit on Tuesday for the major indices and ETFs like the IWM and QQQ.

Volatility is normal for the coronavirus sector with shifts in strength weekly. But over this past week the commentary focused on the need for a coronavirus vaccine. Vaccine availability even by the end of 2020 seems to be a risky assumption but investors swarmed into Inovio Pharmacueticals (INO) up 97% for the week after the Company announced government DOD funding of $71M for a device that delivers its vaccine. Inovio is in a Phase 1 trial for its vaccine and the Company has a market cap of $5B (similar to Novavax). Inovio should be releasing Phase 1 data in July.

  • Other major major vaccine players were mixed: BNTX was up 4.05% to $62.13, Novavax (NVAX) down 7.36% to $77.39, and Moderna (MRNA) down 1.16% to $61.28 .The leadership among these smaller players has changed many times but MRNA stock has fallen behind this month.
  • Quidel (QDEL) regained momentum up over 9% for the week hitting $221 Friday after testing levels under $200 earlier in the week. Covid testing is more important than ever but performance of various tests (antibody and PCR) is not well documented, and market leaders have not emerged.
  • Vir Biotechnology (VIR) may be the most volatile of all biotech stocks, down $13.88% on Friday to $38.33 after hitting highs of $48.56 on Thursday. Its previous high was $60.20 spiking on 2/27/20! We sold our small positions last week but will get back in as news develops on their antibody therapies for HBV, FLU and COVID.

A risk-off situation is developing as COVID infection gains correlates with market losses and the NASDAQ is up 8.74% YTD.

Coronavirus Pure Plays Week Ending June 27, 2020

Company Stock 3/6 P %Perf 3/16 P MCap 4/30 6/27/P %Perf  
      week   $B 3/16     YTD  
Co-Diagnostics CODX 12.89 -8.83 9.09 0.226 11.34 18.08 19.2  
Gilead Sci GILD 80.23 8.5 68.9 87.06 84 74.57 14.76  
Genmark Dx GNMK     4.54 0.275 12.51 14.09 192.93  
Inovio INO 14.09 166.31 6.13 1.12 12.03 29.98 808  
Moderna MRNA 29.61 8.6 26.49 9.77 46 61.28 213.3  
Regeneron REGN 494.43 8.3 440.83 48.5 525.9 611.36 62.8  
Teledoc TDOC 135.9 9.6 116,74 8.49 164.6 193.26 130.8  
VIr BIO VIR 45.7 15.1 45.76 4.61 30.51 38.83 208.8  
                   
                   
BioNTec BNTX     40   47.48 62.13 50  
ChemBio Dx CEMI     2.36   12.7 3.27 129.2  
Hologic HOLX     32.25   50.1 53.52 4.52  
NovaVax NVAX     6.91   18.13 77.39 1844  
Quidel QDEL     74.2   139 221 194.55  
                   
IBB             135.16 12.16  
XBI             110.42 16.1  
QQQ             240.22 13

Disclosure: None.

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William K. • 3 years ago • Member's comment

Even after some vaccine that is effective is found it will be over a year before it can be used in meaningful amounts, thanks to FDA requirements. So any claims that the plague is ending are vastly premature.

So the really bad news is that half of the world's population could die. Will this have a negative effect on the stock market? At that point will anybody be left to care?