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One company developing a vaccine for covid issued a statement of uncertainty that spooked investors.
Shares of Novavax Inc. (NVAX) – Get Free Report took a hit this week after the company said there is substantial doubt about the company’s ability to continue.
The stock was valued at $8.97 per share on Feb. 27, dropped significantly on Feb. 28, bottoming out at $6.67 on March 2, then climbed to $7.67 March 3.
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“I’ve been saying the thing is not phony, but worthless, for a very long time,” Jim Cramer said March 1 on CNBC, according to Benzinga.
In a press release Feb. 28, Novavax cited uncertainty regarding government funding and arbitration issues.
“While our current cash flow forecast for the one-year going concern look forward period estimates that we have sufficient capital available to fund operations, this forecast is subject to significant uncertainty, including as it relates to 2023 revenue, funding from the U.S. government, and pending arbitration,” Novavax said.
“Given these uncertainties, substantial doubt exists regarding our ability to continue as a going concern through one year from the date that these financial statements are issued,” the press release continued.
Cramer indicated he already had an expectation that the company would issue a statement to this effect.
“I didn’t want them on the show, I just didn’t because I think that they had been very promotional. Well, they’re not promotional today,” Cramer said.
Novavax had said previously it was developing a covid vaccine as good as the vaccines from Pfizer (PFE) – Get Free Report and Moderna (MRNA) – Get Free Report, Cramer said.
The Centers for Disease Control and Prevention (CDC) recommended the Novavax protein vaccine in July of 2022.
“If you have been waiting for a COVID-19 vaccine built on a different technology than those previously available, now is the time to join the millions of Americans who have been vaccinated,” Dr. Rochelle Walensky, CDC’s director, said in a statement at the time.
“Much has been achieved over the past three years,” Novavax CEO John Jacobs said in the press release. “Based on the foundation that has been laid to date, I believe that Novavax has significant potential for a bright future.”
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