We recently published a list of 12 High Growth Large Cap Stocks to Buy Now. In this article, we are going to take a look at where Moderna, Inc. (NASDAQ:MRNA) stands against other high growth large cap stocks.
BlackRock highlighted that its portfolio managers are broadly optimistic about US equities. Its portfolio managers opine that there is still some expected upside potential, despite the steep US stock valuations. However, the contrast between lagging European economic growth, and stock performance, is stark. The US Fed decided to reduce the policy rate by another 25 bps in a recent meeting as the apex bank sees inflation moving closer to its target of 2%.
However, the financial conditions remain loose after a historically sharp tightening cycle. The firm believes that such an unusual backdrop strengthens its view that the environment is being dominated by structural forces and not by a typical business cycle.
Overall, the firm remains overweight on the US given the positive view on the AI theme. The valuations for AI beneficiaries have strong backing as technology companies continue to beat high earnings projections. The asset manager believes that falling inflation continues to ease pressure on corporate profit margins.
High-Single Digit Growth in S&P 500
Goldman Sachs Research’s projections for the S&P 500 Index of stocks remain broadly the same as it was before Trump’s win. As per David Kostin, the chief US equity strategist at the firm, the S&P 500 is expected to reach 6,300 in the upcoming 12 months. The researchers expect growth in EPS of 11% in 2025 and 7% in the following year. That being said, David Kostin highlighted that the estimates might change as and when the new administration’s policy agenda gets revealed. Overall, strong earnings growth is expected to fuel continued equity market appreciation into next year.
Historically, the S&P 500 index generated a median return of 4% between election day in November and calendar year-end, as per Goldman Sachs. Together with the resilience in broader economic growth data and the expectation for further rate cuts, the near-term outlook for US equities remains healthy, as per Kostin.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
US Tariffs’ Impact
Several investors remain focused on trade policy, and Mr. Trump might have plans to implement some of the tariffs without legislation. Goldman Sachs believes that Trump will impose tariffs on imports from China. These are expected to average an additional 20 percentage points. Furthermore, European companies can face tariffs. The large investment bank also highlighted that, during Trump’s previous administration, domestic-facing and defensive industries, including utilities, telecom services, and real estate, outperformed. On the other hand, the stocks of automobiles, capital goods, and technology hardware underperformed.
The company believes that M&As might increase under Trump’s presidency. Though the policy uncertainty will take time to recede, there are expectations that antitrust regulation will be more relaxed. Moreover, the continued economic expansion and higher confidence among CEOs might result in increased corporate combinations. Approximately, $4 trillion of corporate spending in the next calendar year might roughly get evenly split between returning cash to shareholders and growth investments (such as CapEx, R&D, and M&A).
A financial analyst looking through a microscope at stocks to determine their market value.
Our Methodology
To list the 12 High Growth Large Cap Stocks to Buy Now, we sifted through several online rankings and a screener. We extracted the stocks that have a healthy 5-year revenue growth and a market cap of more than $10 billion. Finally, the stocks were ranked in ascending order of upside potential, as of 12th November.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Moderna, Inc. (NASDAQ:MRNA)
5-Year Revenue Growth: ~128.5%
Average Upside Potential: ~67.9%
Market cap as of 12 November: $16.6 billion
Moderna, Inc. (NASDAQ:MRNA) is a biotechnology company, that discovers, develops, and commercializes messenger RNA therapeutics and vaccines for the treatment of infectious diseases, immuno-oncology, rare diseases, autoimmune, and cardiovascular diseases.
One of Moderna, Inc. (NASDAQ:MRNA)’s key focus areas for growth is the respiratory syncytial virus (RSV) vaccine, mRESVIA. The US FDA approved mRESVIA in 2024. Moving forward, the company remains focused on fueling sales growth and reducing its cost structure. Moderna, Inc. (NASDAQ:MRNA)’s future growth potential stems from its diverse pipeline of mRNA-based therapeutics and vaccines. Its mRNA-4157, in combination with Merck’s Keytruda, demonstrated promising results in early-stage trials for melanoma and head and neck squamous cell carcinoma.
Moderna, Inc. (NASDAQ:MRNA)’s investigational therapeutic for MMA (mRNA-3705) was selected by the U.S. FDA for the Support for Clinical Trials Advancing Rare Disease Therapeutics (START) pilot program. The FDA and the company have agreed on the pivotal study design. Moderna, Inc. (NASDAQ:MRNA) anticipates to start a pivotal study in H1 2025.
Wall Street analysts are quite optimistic about a joint agreement with Cenra Healthcare to promote Moderna’s mRNA respiratory vaccine portfolio in Taiwan, which includes COVID-19 vaccines. Cenra’s strong presence in the market should help ensure broader access to Moderna, Inc. (NASDAQ:MRNA)’s vaccines. This partnership will enable it to expand its future portfolio, primarily as respiratory diseases are posing a global threat.
Moderna, Inc. (NASDAQ:MRNA)’s progress in cancer vaccines, mainly the combination of mRNA-4157 with Keytruda, reflects promise in catering to significant unmet medical needs. The company’s work on combination vaccines, like the Flu+COVID vaccine, might offer a competitive edge in the evolving vaccine landscape. Its broad pipeline, such as candidates for CMV, norovirus, and other indications, should translate into multiple avenues for future growth and revenue diversification.
As per Wall Street analysts, the shares of Moderna, Inc. (NASDAQ:MRNA) have an average target price of $87.71.
Overall, MRNA ranks 2nd on our list of 12 High Growth Large Cap Stocks to Buy Now. While we acknowledge the potential of MRNA as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued AI stock that is more promising than MRNA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.