Moderna's Stock Rally Was "Excessive": Why a Citi Analyst Expects It to Fall 60%

It's time for shareholders of biotech giant Moderna to sell their shares, according to Citi analyst Jeff Micham. He downgraded his recommendation on the pharmaceutical company’s stock from “hold” to “sell,” while raising the price target from $60 to $80, according to CNBC. However, despite the target increase, the new target still implies a 60% decline in Moderna’s stock price relative to its September 29 closing price. Moderna shares fell nearly 7% during trading on September 30, hitting a low of $184.58 per share. Nevertheless, they are up more than 540% year-to-date.

Moderna's stock has been rising sharply since August 19, when the company announced positive results from the final phase of clinical trials for an experimental personalized cancer vaccine known as intismeran autogen. Since the release of these results, Moderna’s stock has surged 223%.

However, Micham considers this growth “excessive,” according to Barron’s. “It’s difficult for us to justify such a valuation by comparing it to public companies or based on the net present value of [the company’s] development pipeline,” he said, noting that Moderna’s market capitalization—approximately $80 billion—is comparable to that of another major pharmaceutical company, Regeneron, “despite significantly lower expected revenue and earnings.” Using the net present value (NPV) method (which estimates the present value of future revenues from a drug), “even if we assign a 100% probability of success to future treatment programs using intismeran, this justifies a price of only $100 per share for Moderna, which is nearly 50% below the current level,” the analyst added. “For the [biotech’s] stock price to reach around $200 per share, annual sales of oncology drugs would have to total about $26 billion, of which $13 billion would be attributable to Moderna itself,” — Micham continued, emphasizing that this is “nearly seven times higher than the figures embedded in Citi’s model.”

The stock market is demanding more from Intismeran, according to an analyst quoted by Barron’s. Although the latest trials of the drug met their goals, detailed figures have not been disclosed. As is often the case with preliminary results, the announcement merely noted that treatment with a combination of intismeran and Merck’s Keytruda proved more effective at preventing skin cancer recurrence than Keytruda alone.

“Overall, we believe that due to aggressive sales targets (Moderna itself, in its second-quarter 2026 earnings report, forecasts full-year total revenue growth of up to 10%. — OnInvest note) and unrealistic assumptions about the probability of success, the current valuation [of Moderna’s securities] is unwarranted, and the risk-reward ratio is skewed negatively,” Micham asserts.

The next catalyst for the stock could be the annual meeting of the European Society for Medical Oncology in late October, where Moderna is expected to present more detailed information about its intismeran treatment program, Barron’s notes. However, according to a Citi analyst, obtaining regulatory approval—which, according to optimistic projections, is just a few months away—will only be half the battle. To justify Moderna’s high valuation, late-stage trials of the drug must demonstrate clinical benefits sufficient to offset the high costs of producing personalized vaccines for a broader audience, he noted.

The downgrade makes the Citi analyst one of the most skeptical players on Wall Street when it comes to Moderna. For the most part, analysts are taking a wait-and-see approach to the company's stock: 17 out of 27 recommend holding it. Six recommend buying, and four recommend selling.

This article was AI-translated and verified by a human editor