Moderna is officially in its “we peaked in high school” phase with investors. You know the type—star quarterback, prom king, and then, boom, real life hits, and now they’re working at McDonald’s. 

For a company that saw its stock price shoot up from $20 in January 2020 to $449 in September 2021 (seriously, a nearly 2,145% gain), this just adds to the disappointment. But with shares already down 7% in premarket trading, it looks like this could get ugly by the end of the day.

So, what’s going on? Moderna, once rocketed to the moon by its Covid vaccine, is now in the uncomfortable position of figuring out life after the big bang. Their Covid shot was like hitting the biotech lottery—sales shot up to an incredible $18.5 billion in 2021. 

But now, that jackpot is drying up. For 2024, they’re looking at a much less impressive $3 billion to $3.5 billion in sales. That’s a sharp fall from their earlier projection of $4 billion, and the shine is wearing off fast. 

In response, the company announced it plans to slash $1.1 billion in expenses by 2027. Translation: they’re scaling back from their “just put it in the cart” spending spree that was fueled by Covid's cash windfall. You know, the one that had Wall Street treating Moderna like the next Apple. But with Covid no longer top of mind and vaccine sales in freefall, they’re recalibrating. And by recalibrating, I mean they’re cutting the R&D budget by about 20%, pausing some of their “let’s cure everything” projects, and putting others on ice.

CEO Stéphane Bancel didn’t hide it—some projects are being “sunset,” which is corporate-speak for “we’re done here.” This includes ambitious work on latent viruses that’s now on hold. But it’s not all bad news: Moderna still plans to push out 10 new products by 2027, including a Covid-flu combo shot and a personalized cancer vaccine with Merck. They’re also fast-tracking approval for their RSV vaccine, hoping to hit the market by 2025.

Still, investors are feeling the burn (not the Sanders one). Analyst Michael Yee sees the expense cuts as a necessary step to regain investor confidence, but the fact that Moderna’s now pushing its break-even goal to 2028 isn’t exactly inspiring confidence on Wall Street.

So, what’s the play here? Moderna’s not flirting with bankruptcy—not even close. With 10 new products in the pipeline, including the highly anticipated cancer vaccine, there’s definitely potential. But don’t expect another rocket ride like we saw during the pandemic. Moderna’s stock has dropped 70% from its 2021 high, now hovering around $100. The P/E ratio of 8x might look like a bargain in the biotech world, but their EPS has plummeted to $5.22, down from an eye-watering $28.29 during their Covid heyday.

Is Moderna a good dip buy? If you’re in it for the long haul, their pipeline of new products, especially in cancer and respiratory vaccines, could make it a strong play. But if you’re looking for a quick rebound, you might be left waiting.

P.S. While analysts are still debating whether Moderna’s 70% stock drop makes it a dip-buy opportunity...

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Stock.News has positions in Moderna, McDonald’s, Merck, and Apple.