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Is VXRT Stock a Solid Long Term Investment?


It seems like it's becoming more and more difficult to find long term stock market investments that can actually provide you with the money that you're hoping to get by having them in your portfolio. There are a couple of different reasons that it has become more difficult to invest in the stock market over the last several years.

One of those reasons has everything to do with the state of the economy in general. Another is that things are rapidly changing in the world when it comes to things such as technology, medicine and the like. All of that means that it's not always as easy to pick out a stock that could potentially be a high performer in the long-term.

It's not like this was ever an easy task, but it used to be a little bit easier than it is now because there wasn't as much competition. These days, if you want to find a stock that is a potential buy for a long-term investment, you have to look at a number of different factors because there are probably already three or four other companies that are about to do exactly what the company you're thinking about investing in is already doing.

Consider Vaxart, for example. They are a company that deals with making vaccines, hence their name. However, they put a special twist on things, as you'll see in the following paragraph. That means that they might be a good candidate for a long-term investment, provided they have the numbers to back it up.

All About Vaxart

Traded publicly as VXRT, this company was founded in March of 2004. It's true that they deal with vaccines, but that isn't the whole story. As a matter of fact, they put a spin on things that truly makes them stand out among the crowd in an industry where there are numerous similar companies that are being publicly traded.

What makes this one so special? They don't design their vaccines so that they have to be taken in the traditional manner that vaccines have always been administered, through the use of a needle. Instead, the company puts its vaccines in tablets so that their customers can get the much-needed medicine in pill form.

This essentially eliminates the need for vaccines to be given through needles, something that is a huge benefit to those individuals who are genuinely terrified of them, even to the point of choosing not to get a vaccine as opposed to facing their fears. At the end of the day, that means that more people are likely to take the vaccines that they need in order to remain healthy. That in turn is a huge benefit to individuals as well as to public health as a whole.

Current Performance in the Stock Market

Surprisingly, this particular stock is selling for what many people consider to be an overly reasonable price, just $3.86 per share. When you think about the fact that the company deals with something that other vaccine companies aren't even approaching and you couple that with the current price per share, it makes you wonder why everybody isn't jumping on the opportunity to purchase shares of this particular stock.

However, the value of the stock actually decreased throughout the most recent day of trading. That's concerning enough in and of itself, but the thing that's even more concerning is how much it dropped. In one day of trading, it lost 3.74% of its value. For a stock that was already selling at a low rate, this may not seem like all that much.

In fact, the stock only lost $0.15 per share. However, it does make you wonder why the stock is selling for such a low price and why it dropped by close to 4% in a single day. It seems like one of the best ideas to come along in quite some time when you think about the type of work that the company does.

That being said, you have to ask yourself whether or not there is something else going on that might potentially be causing a problem. After all, there has to be some type of reason why values of the stock have gone down so far. Is there a possibility that the value of the stock is fluctuating because there is something happening on a grander scale that you need to be aware of as a potential investor? The truth is, you won't know until you start taking a closer look at things. Since there is no time like the present, it's time to do exactly that.

Stock Market Performance and Predictions

At the moment, the stock is going down. However, an overwhelming number of stock market analysts believe that this trend is only temporary. As a matter of fact, most of them are in firm agreement that the stock will eventually turn around, although they don’t anticipate that occurring for at least a few months.

If you want something that is more exact, consider this. Approximately 75% of the stock market analysts who have made predictions about this particular stock believe that it will continue its downward trend until at least July of this year. After that, they expect it to turn around and increase in value.

Some of them even believe that it will increase by more than $10 per share, eventually becoming worth about $19.00 per share. Is that enough to get excited about? It really depends on your idea of what constitutes value in a stock and whether or not you're willing to pay a little less than $4 per share now with the opportunity to make closer to $20 per share only a few months down the road.

Of course, that does mean things will have to go as the stock market analysts believe they will go. It's always important to remember that a lot of different variables can happen within the stock market and that can have a direct impact on the value of any particular stock. As a result, you might find that the stock is actually worth more than the predicted amount by the end of July. By the same token, it could also be worth significantly less.

You also have to ask yourself another question. What could potentially happen if you were to decide to hold on to the stock for more than just a few months? If you purchased it now and decided to keep it in your portfolio for at least a year, could you make a significant sum of money? If you're thinking about purchasing any stock as a long-term investment, this is a question that you have to ask yourself.

Period-to-Period Comparison

While some stock market analysts (most of them, in fact) believe that the stock is going to turn around and start going in the right direction, not everyone is entirely convinced.

Much of that has to do with the way that the stock has performed over the course of the last couple of weeks, not to mention the fact that when this time period is compared to the same time last year, performance has fallen off sharply. As a matter of fact, the value of the stock has fallen for four consecutive days during the last seven days of trading alone.

To make that point stick, it's important to look at things a little further back. When you do, you'll realize that the stock has fallen seven of the last 10 days. Perhaps the thing that really sends up red flags is the fact that when you look at the value of the stock for this time period and compare it to the same time frame from last year, the stock has fallen off by more than 20%.

Obviously, you have to ask yourself what is going on here. If the company is so innovative with the product that they offer, why are they having so much trouble maintaining their value? There isn't a reasonably responsible investor alive that would even dream of investing in this stock as part of their long-term portfolio without finding an answer to this question first.

It's imperative to know what that answer is, as you don't want to spend money on something that is incapable of having at least a decent chance of giving you a good return on your investment. If you're investing in something that isn't capable of performing well because of something that's going on within the company itself, you're not really doing anything short of wasting your own money.

Contrasting Views?

There is something else that you have to consider here. The stock doesn’t seem to be performing well at the moment, yet there are several stock market analysts that believe things will get better within the next few months. If the stock hasn’t been able to recover over the course of the last several months, what makes them think that it will eventually do so?

For the most part, stock market analysts think that the company is on solid footing. However, they are also a medical company that conducts research and that often means that they aren’t operating at a profit. This can sometimes cause investors to get nervous and when they do, they start selling off their shares as fast as they can.

As a direct result, there is often some discord about what’s going to happen in the future. It may or may not have a basis in some actual, tangible concern. On the other hand, it might not be based on anything more than a lot of speculation. In many cases, it ends up being based on only one thing- fear.

Digging Deeper

You already know that the company has been in operation for a number of years. Here’s where things start to get interesting. If you really want answers to why the company isn’t performing better on the stock market, here you go. For starters, they are indeed a medical research company.

As such, they have conducted research that centers around allowing people to take vaccines in pill form for a long time, but they haven’t had any breakthroughs yet. That’s right, they currently have zero products on the market that can actually be used by the general public.

Furthermore, they have been investigating an oral vaccine for Covid-19, but they are nowhere near getting any approval for said vaccine. That is having a major impact on their ability to maintain their position in the stock market. To make matters even more challenging for them, there is no guarantee that they will gain the needed approval for their version of a vaccine.

If they can’t get the approval, they may find themselves facing a dire situation. Obviously, this could have an adverse impact on their ability to develop other, unrelated oral vaccines in the future.

Impossible to Agree?

This is where stock market analysts find it almost impossible to agree. If you’re looking at things strictly from a financial perspective, then you might believe that the company is on the verge of doing great things. The truth is, they just might be. That being said, it is anything but a foregone conclusion that the company will get approval for their Covid vaccine.

If they don’t, it could potentially spell financial ruin for them. That basically places them in a holding pattern until they either receive approval or they’re forced to restructure. Typically, this is not the type of situation that you want if you’re looking for a long-term investment. In fact, it’s exactly what you don’t want.

There are plenty of companies out there that have more going for them than this one currently does. If you want to keep it in mind and look at things in a year or so, that's fine. However, there is no reason to invest in this company at the current time. The prospect of doing so is just too risky for it to make any sense.

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Allen Lee

Written by Allen Lee

Allen Lee is a Toronto-based freelance writer who studied business in school but has since turned to other pursuits. He spends more time than is perhaps wise with his eyes fixed on a screen either reading history books, keeping up with international news, or playing the latest releases on the Steam platform, which serve as the subject matter for much of his writing output. Currently, Lee is practicing the smidgen of Chinese that he picked up while visiting the Chinese mainland in hopes of someday being able to read certain historical texts in their original language.

Read more posts by Allen Lee

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