Vaxcyte (PCVX) Updates VAX A1 Trial, Is It Still A Bargain?

Vaxcyte (PCVX) is back in focus after updating investors on its VAX-A1 clinical trial targeting Group A strep infections, along with renewed attention from Wall Street that is highlighting the company’s broader vaccine pipeline.

See our latest analysis for Vaxcyte.

Against this backdrop, Vaxcyte’s recent 19.75% 1 month share price return and 25.68% year to date share price return, alongside a 75.61% 1 year total shareholder return, suggest momentum has been building as investors react to the VAX A1 update, index inclusions and board changes.

If you are following Vaxcyte’s progress in vaccines, it can also be useful to see what else is moving in related areas by scanning 40 healthcare AI stocks.

With Vaxcyte now in major growth indexes, a recent VAX A1 update, and the stock trading at a discount to some analyst targets, investors have to ask: is there still mispricing here, or is the market already factoring in future growth?

Most Popular Narrative: 46.4% Undervalued

Vaxcyte’s most followed narrative points to a fair value of $109 per share, compared with the last close at $58.39. This represents a wide gap that hinges on specific revenue and margin assumptions.

Resumption of development for VAX-A1, targeting Group A Strep in both adults and children, positions the company in another large infectious disease area where current burden and costs are high. This could diversify future revenue streams and spread R&D and commercial infrastructure across more than one product.

Read the complete narrative.

Want to see what underpins that gap between Vaxcyte’s share price and the fair value? The narrative leans on sharp revenue ramp up, margin expansion and a rich future earnings multiple. Curious which specific assumptions have the biggest impact on that valuation path?

Result: Fair Value of $109 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, there is still clear risk to the Vaxcyte story if late stage VAX 31 data disappoints or cash is used faster than current runway guidance implies.

Find out about the key risks to this Vaxcyte narrative.

Next Steps

Given the mix of optimism and concern around Vaxcyte, it may be useful to review the underlying data directly and form an independent view using the 2 key rewards and 3 important warning signs.

Looking for more investment ideas beyond Vaxcyte?

If Vaxcyte has sharpened your interest in new opportunities, it makes sense to keep that momentum going by checking a few focused stock lists that highlight different strengths.

• Spot potential value candidates quickly by scanning companies flagged as 44 high quality undervalued stocks that may merit a closer look.
• Prioritise resilience by reviewing 74 resilient stocks with low risk scores and see which businesses stand out on stability and risk scores.
• Hunt for future standouts by working through a screener containing 18 high quality undiscovered gems before other investors start paying attention.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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