Novavax: A Great Buy On Quickly Growing Production, Super Low Valuation And Many EUA Filings

Oct. 30, 2021 8:00 AM ETNovavax, Inc. (NVAX)213 Comments
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Summary

  • Novavax's manufacturing targets are on track and just increased dramatically to 2.4 billion doses per year. EUAs have been filed in multiple countries and more are coming soon.
  • Novavax already has orders for about 2 billion doses, far more than most people realize. I expect it will sell about 2.7 billion doses between 2021 and 2022.
  • I expect very high revenues of ~$22 billion in 2022 will result in high profits, and also a far higher share price.
  • The stock is heavily undervalued, as illustrated by the consensus price target of analysts that is roughly 95% higher than the current price.
  • A recent article full of inaccuracies caused the stock to unjustifiably drop 20%. Now Novavax is an even greater buy, one of the best buys I've seen in years.
Vials With the Covid-19 Vaccine and Syringes are Displayed On a Tray at the Corona Vaccination Center

Morsa Images/DigitalVision via Getty Images

In investing, any time there is a major gap between popular perception and reality, a good buying opportunity often exists, and sometimes even a great one. Right now, there are three major informational gaps of this type related to Novavax (NASDAQ:

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I search for companies that have strong fundamentals, but that are undervalued due to fear, so I can invest in them at a great price. I also search for companies that are overvalued due to greed that have weaknesses such as poor free cash flow or an unviable business model, so I can short them. As Warren Buffet recommends: buy fear and sell greed. When I find potential candidates, I research the daylights out of them and only choose the best opportunities. To give you an idea of some the stocks I’ve focused on, in the past I successfully shorted Twitter, GoPro, Garmin, TrueCar, FCX, Wayfair, Pandora and Transocean, and was successfully long Cisco, Expedia, Novavax, Goodyear Tire, Facebook, Apple, Celgene, BioNTech and Novocure. Many of those are no longer good shorts or longs. For example, as of November 2021, Apple and BioNTech are overvalued. My current favorite long stock is Novavax (NVAX). I was previously a consultant for executives at companies such as Fidelity Investments and Google, including the Vice-president of Sales at Google. Prior to that I owned and operated two retail stores that I sold, and before that I was a journalist. I’ve been investing for 27 years in stocks, bonds, commodities and options. I spend a lot of my free time researching investments and donate at least half of the gains to charity.

Disclosure: I/we have a beneficial long position in the shares of NVAX, PFE either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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