What happened
Actions of Vaxart (NASDAQ: VXRT) 26.4% more rocketed as of 11:22 am EDT on Monday. The big jump came after investment bank B. Riley FBR began hedging the shares with a buy rating and $ 22 target price. This target price represented a 176% premium over the closing price of Vaxart on Friday.
And that
It is generally best to take analyst price targets with a grain of salt. On the other hand, investors can benefit from trying to understand why analysts like or dislike a particular stock.
Image source: Getty Images.
In this case, B. Riley FBR appears to be very optimistic about the prospects for the Vaxart oral COVID-19 vaccine candidate. This experimental vaccine was recently selected by the US government’s Operation Warp Speed for funding and inclusion in a preclinical study.
However, keep in mind that it is too early to know if Vaxart will be successful. In April, the company reported encouraging results for its candidate COVID-19 oral vaccine in preclinical testing. However, the vaccine candidate has not yet advanced to clinical trials.
Now what
Vaxart hopes to advance its oral candidate for the COVID-19 vaccine to a phase 1 study in the second half of 2020, potentially as early as this summer. Until that test begins, likely the main catalyst for the biotech stock will be the results of preclinical testing of its universal oral flu vaccine. This preclinical test is performed in collaboration with Johnson and Johnson.
