The race to win in 2020
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    The race to win in 2020

    Alice Shen, Senior Associate - Investments & Capital Markets
    21 September 2020


    One of the million-dollar questions these days is which company will first develop a COVID-19 vaccine and when is it going to be publicly available? If a vaccine is successfully developed, we think there is going to be a significant lift in share prices across the pharmaceutical industry.

    A number of contestants are at the forefront of the worldwide vaccine race:

    AstraZeneca
    The University of Oxford and AstraZeneca have restarted the human vaccine trial after it was halted following concerns of an ill participant. Since the start of the trial in April, it is reported that the vaccine has triggered increased levels of protective neutralising antibodies and immune T-cells that target and destroy infected cells.

    Merck & Co
    On 12 September, Merck & Co announced it has begun testing one of its vaccine candidates in healthy volunteers, which aims to determine the safety level in humans, and also the effectiveness in terms of triggering an immune response to the new coronavirus.

    Pfizer
    Pfizer and BioNtech have recently submitted requests to the US FDA to expand their trial population to 44,000 participants, aiming to introduce more population diversity in ages as well as existing health conditions. If the results are positive, the company may submit the vaccine for regulatory approval in October.

    Based on consensus estimates, all three stocks are highly rated as buy or hold. Merck even has an incredible 81% buy with no sells. The market sentiment is very positive towards these pharmaceutical companies.

     

    Consensus Rating

    12m Target Price

    Return Potential

     

    Buys

    Holds

    Sells

     

    AstraZeneca

    56.70%

    23.30%

    20.00%

    88.982

    5.50%

    Merck

    81.0%

    19.0%

    0.0%

    96.17

    13.80%

    Pfizer

    38.90%

    61.10%

    0.00%

    41.41

    14.80%

    Source: Bloomberg as of 14 September 2020

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