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Vaxart (NASDAQ: VXRT): Potential Big Winner With a Troubled Past

Posted on Thursday, July 2nd, 2020 by Steve Anderson

Vaxart (NASDAQ: VXRT): Potential Big Winner With a Troubled Past

Vaccines are big business. No matter what else you could say about them—and you could say plenty, starting with “they're one of the greatest things modern civilization has to offer” and ending with “they're eventually going to kill us all”—it is thoroughly undeniable that they are big business. To that end, there's an unexpected, and potentially massive winner, lurking in the stock markets today. It's called Vaxart  (NASDAQ: VXRT) , and it just might be the big deal you're looking for.

It Wasn't Always A Penny Stock...

According to the Securities and Exchange Commission (SEC), a “penny stock” is any stock trading under $5 per share. Looking back on Vaxart's last year, it had all the telltale markings of a penny stock. It spent the entire timeframe between July 2019 and most of January 2020 trading in the sub-dollar range.

But as January faded out, something happened to the company that catalyzed the start of hefty gains. In the time between January 30 and February 3, the company's share price doubled in value. Granted, that's not much of an increase; it went from $0.73 to $1.60, but a double is a double no matter what base you start with.

Then, in perhaps an even bigger shocker, came the Massive Indiscriminate Coronavirus Sales Event with March. While Vaxart shares did take a dip in March, going from $2.76 on March 9 to $1.46 on March 13, the sales dip did not last. The company saw a V-shaped recovery, going to $2.34 on March 18. It then slipped into a kind of plateau that lasted about three weeks before starting to go up again.

That's when the usually-impossible happened. After trading fairly flat with a few ups and downs, the company's value exploded, going from $2.66 on June 23 to close at $8.85 on June 30. In the space of a week, the company's value had better than tripled.

However, there's one point that must be considered about Vaxart. It was not always a penny stock. The company has been in play since 1969, reports note, and looking at its five-year trading graph shows a stock that has faced enormous catastrophe. The company's stock price on August 7, 2015, was $26.84. It's been on a fairly steady downward spiral for the last five years, until this recent spike broke the streak.

What Even Causes That Kind of Value Fluctuation?

The Motley Fool was willing to kick off an article about Vaxart with the rhetorical question, “Could Investing in Vaxart Make You a Millionaire?”, The Fool would have been exactly right, too, especially if you'd put somewhere around $300,000 into Vaxart stock back on June 23. You would have been a millionaire around June 30, and potentially, even remained so after taxes. If you'd had that same $300,000 in Vaxart back in 2015, meanwhile, you would have lost almost all of it.

So now we need to consider just what happened to throw that kind of upward cant into the share price. The biggest catalyst seems to be that the company was selected to join the accelerated vaccine development program the US is running, known as Project Warp Speed. Further, it made a roster change, bringing in a new CEO who immediately shifted focus to the vaccine program. The company's former CEO will remain as chairman of the board.

It also some moves to step up its internal manufacturing capabilities to keep up with the demand that will be placed on inventories to stage clinical trials. That combination of factors not only puts the company on a pretty positive trend line right now but suggests it's planning to stay there.

Oh, and one more thing: the company has one particular ace up its sleeve that could fundamentally change the nature of medicine. You know how most vaccines are delivered via arm jab? Vaxart has figured out a way to deliver vaccines via a pill. This means that the vaccine can be administered without the need for skilled healthcare workers, without the need to refrigerate injectable vaccine for transport, and without the need for extra materials like syringes and sterile wipes.

A Speculation, But Potentially, A Huge One

There's no doubt that Vaxart has had tremendous upward momentum in the last couple of months. It weathered one of the worst events in stock market history and one of the worst economic environments since the Great Depression. Given the current state of events, it may be that Vaxart is making a comeback, going from a company trading in the $20-$30 range per share to one that aspired to the whole-number range.

If Vaxart's world-changing development does pan out, though, it's going to be on the forefront of an advance in vaccine technology that will change the world, and right at a time when vaccines will be more hotly sought-after than ever. Buying into Vaxart now is speculation, pure and simple, but one that has one monster potential upside to it.

Companies Mentioned in This Article

CompanyBeat the Market™ RankCurrent PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Vaxart (VXRT)1.5$9.19+1.0%N/A-15.58Buy$11.67
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