Shares of COVID-19 vaccine company Moderna, Inc. (NASDAQ:MRNA) which ended Thursday’s session with a market cap of $104.3 billion by virtue of a 5.3% rally, are seeing follow-through buying interest Friday.
Standard & Poor’s announced late Thursday Moderna will join the S&P 500 Index, effective before the market opens Wednesday, July 21.
Moderna will replace Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN) which is to be acquired by U.K. pharma giant AstraZeneca plc (NASDAQ:AZN) in a deal expected to be completed soon pending final closing conditions.
Index inclusion is usually positive for stocks, as funds holding portfolios mirroring the index will buy into the stocks to maintain the respective weightings of the component stocks. The stock will also benefit from increased volume and liquidity due to purchases by index funds and ETFs.
Moderna is one of the early entrants into the COVID-19 vaccine market, having secured authorization for emergency use of its vaccine in countries including the U.S., E.U., Canada U.K., Israel and India.
Also, Michael Yee, an analyst at Jefferies, increased his price target on the stock from $170 to $250.
Jefferies’ higher price target for the vaccine stock reflected expectations of increased sales for Moderna’s COVID-19 vaccine this year. Yee now looks for the company to up its full-year revenue guidance to $21 billion. It previously projected sales of $19.2 billion.
Moderna closed with a market cap of over $100 billion for the first time on Thursday. In early trading Friday, Moderna shares were advancing $25.93, or 10% to $285.60.