Moderna (NASDAQ:MRNA) shares jumped 16% on Wednesday, March 5, following a favorable German court decision that determined BioNTech and Pfizer violated Moderna’s mRNA patents. Moderna is pursuing compensation based on all Comirnaty sales during the past three years. [1] Additionally, confidence among investors was bolstered by Moderna executives purchasing company stock.
After its recent rise, MRNA stock looks unattractive – making it a bad pick to buy at its current price of around $35. We believe there are several major concerns with MRNA stock, which makes it very unattractive given that its current valuation looks moderate.
We arrive at our conclusion by comparing the current valuation of MRNA stock with its operating performance over the recent years as well as its current and historical financial condition. Our analysis of Moderna along key parameters of Growth, Profitability, Financial Stability, and Downturn Resilience shows that the company has a very weak operating performance and financial condition, as detailed below.
How does Moderna’s valuation look vs. the S&P 500?
Going by what you pay per dollar of sales or profit, MRNA stock is currently valued in line with the broader market.
• Moderna has a price-to-sales (P/S) ratio of 3.7 vs. a figure of 3.1 for the S&P 500
How have Moderna’s revenues grown over recent years?
Moderna’s Revenues have fallen considerably over recent years.
• Moderna has seen its top line shrink at an average rate of 36.8% over the last 3 years (vs. 9.8% for S&P 500)
• Its revenues have shrunk 52.6% from $6.8 Bil to $3.2 Bil in the last 12 months (vs. change of 5.6% for S&P 500)
• Also, its quarterly revenues shrank 66.0% to $956 Mil in the most recent quarter from $2.8 Bil a year ago (vs. 7.2% change for S&P 500)
How profitable is Moderna?
Moderna’s profit margins are considerably worse than most companies in the Trefis coverage universe.
• Moderna’s Operating Income over the last four quarters was $-3.9 Bil, which represents a very poor Operating Margin of -123.3% (vs. 12.6% for S&P 500)
• Moderna’s Operating Cash Flow (OCF) over this period was $-3.0 Bil, pointing to a very poor OCF-to-Sales Ratio of -93.9% (vs. 14.4% for S&P 500)
Does Moderna look financially stable?
Moderna’s balance sheet looks very strong.
• Moderna’s Debt figure was $747 Mil at the end of the most recent quarter, while its market capitalization is $14 Bil (as of 3/5/2025). This implies a strong Debt-to-Equity Ratio of 6.2% (vs. 19.7% for S&P 500). [Note: A lower Debt-to-Equity Ratio is desirable]
• Cash (including cash equivalents) makes up $7.0 Bil of the $14 Bil in Total Assets for Moderna. This yields a very strong Cash-to-Assets Ratio of 49.7%(vs. 14.1% for S&P 500)
How resilient is MRNA stock during a downturn?
MRNA stock has seen an impact that was slightly better than the benchmark S&P 500 index during some of the recent downturns. While investors have their fingers crossed for a soft landing by the U.S. economy, how bad can things get if there is another recession? Our dashboard How Low Can Stocks Go During A Market Crash captures how key stocks fared during and after the last six market crashes.
Inflation Shock (2022)
• MRNA stock fell 50.2% from a high of $235.05 on 3 January 2022 to $117.13 on 13 June 2022, vs. a peak-to-trough decline of 25.4% for the S&P 500
• The stock is yet to recover to its pre-Crisis high
• The highest the stock has reached since then is $210 on 21 December 2022 and currently trades at around $35
Covid Pandemic (2020)
• MRNA stock fell 15.9% from a high of $31.58 on 18 March 2020 to $26.57 on 23 March 2020, vs. a peak-to-trough decline of 33.9% for the S&P 500
• The stock fully recovered to its pre-Crisis peak by 2 April 2020
Putting all the pieces together: What it means for MRNA stock
In summary, Moderna’s performance across the parameters detailed above are as follows:
• Growth: Extremely Weak
• Profitability: Extremely Weak
• Financial Stability: Extremely Strong
• Downturn Resilience: Neutral
• Overall: Weak
This isn’t appropriately reflected in the stock’s moderate valuation which is why we think it is very unattractive, which supports our conclusion that MRNA is a bad stock to buy.
While you would likely do well to avoid MRNA stock for now, you could explore the Trefis Reinforced Value (RV) Portfolio, which has outperformed its all-cap stocks benchmark (combination of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices) to produce strong returns for investors. Why is that? The quarterly rebalanced mix of large-, mid- and small-cap RV Portfolio stocks provided a responsive way to make the most of upbeat market conditions while limiting losses when markets head south, as detailed in RV Portfolio performance metrics.
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