It’s been about a year since people started investing in coronavirus vaccine stocks. And there still is plenty of opportunity in these sorts of shares — for investors who like risk and those who don’t. In this Motley Fool Live video recorded on May 28, healthcare and cannabis bureau editor and analyst Olivia Zitkus and Fool contributor Adria Cimino discuss three things to keep in mind before investing in coronavirus vaccine stocks today.
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Olivia Zitkus: I would love if you could share with all of us three big takeaways, big-picture things to walk away from this conversation with healthcare investors. That will be awesome.
Adria Cimino: Sure, sure. OK, well, the first thing I would say is look at market potential when you’re going to invest in a company. Can a particular company actually carve out market share. Like one company that has gained a lot recently is Ocugen (NASDAQ: OCGN). They have rights to a COVID vaccine to sell in the U.S. But that’s going to be a difficult market because the U.S. already has enough vaccines. So that might be a bit difficult and so that’s something to keep in mind when you’re investing. The second thing is to look at the whole pipeline. Don’t just look at the coronavirus vaccine or just any one candidate. It’s good to like the general thing, what the company is doing — to believe in their program rather than just in one product. That’s a safer bet. Finally, there are risky and less risky bets in this space. Now it’s not like you have to just be a high-risk investor to invest in coronavirus vaccine stocks. Like Moderna (NASDAQ: MRNA) is not all that risky now. They have a product out in the market and they are making a lot of money on it. So that could be an option for an investor who likes a safer bet.
Zitkus: Awesome. Sweet. So, look at your market potential, don’t count on just the vaccine alone, look at the entire pipeline. There’s something for everyone. [laughs] That’s the takeaway. On the risk spectrum there is something for everybody in the vaccine market. Even though for a while there it was mostly a risky bet. [laughs]
Cimino: Absolutely. I’d say if you invest in something like Vaxart (NASDAQ: VXRT) or Ocugen those are going to be higher risk stocks. Back then like a year ago, everything was like that because we didn’t know what was going to happen. Whereas now at least you have the safer players and you have the ones that could represent big gains in the future. But for now might be a bit risky.