MRNA and More: 3 Stocks That Can Lose Up to 87% In the Next Year
The markets have been on an absolute tear in the last 15 months.
Since the start of 2020, the S&P
500 has gained around 40% despite a global recession induced by
the ongoing pandemic. While the indexes are trading near record
highs, there are few stocks that remain vulnerable in the
Here, we look at three such stocks that have significant
downside potential from current trading prices.
One of the top-performing stocks on the NASDAQ, Moderna (NASDAQ:
up a staggering 1,760% since it went public in late 2018. It has
more than tripled in 2021 and has gained 320% in the last year.
Moderna stock is currently trading at $340 valuing it a market cap
of $138 billion. Wall Street forecasts Moderna to increase sales by
2,180% to $18.32 billion in 2021. Comparatively, its earnings might
improve from a loss per share of $1.96 in 2020 to earnings of
$24.57 in 2021.
Moderna expects to produce between 800 million and 1 billion
COVID-19 doses in 2021 allowing the company to derive over $19
billion in sales this year. The company is one of the leading
COVID-19 vaccine manufacturers in the world but there is a chance
for sales to fall off a cliff once the pandemic is bought under
For example, Moderna sales are estimated to fall by 16% to
$15.35 billion in 2022 while earnings might decline to $18.2 per
share as well. Analysts tracking the stock have a 12-month average
price target of $185 for MRNA stock which is 46% below its current
The second stock on my list is cannabis giant Cronos Group
This Canada-based pot producer has severely underperformed the
broader markets in the last two years. CRON stock is trading 68%
below record highs and might lose another 20% from current
In 2021, analysts expect Cronos to increase sales by 55% to
$72.26 million. Comparatively, its also forecast to report a loss
per share of $0.62 this year. Given it has 371.66 million
outstanding shares, total losses will stand at $230 million in
2021. So, Cronos is expected to lose over $3 for every $1 in
Cronos ended Q1 with $1.24 billion in cash which means it has
enough liquidity to improve its profit margins without having to
dilute shareholder wealth. In the March quarter, its sales rose by
50% year over year to $12.6 million. However, it still reported a
negative gross margin and an operating loss of $43.5 million.
Cronos has just $9.36 million in debt and is backed by tobacco
giant Altria. The latter pumped in $1.2 billion into Cronos to
acquire a 45% stake in the company, back in 2018.
One of the most
popular meme stocks in 2021, AMC Entertainment (NYSE:
AMC) can lose up to 87% in market value in the next year,
according to consensus price target estimates. AMC shares are up
close to 2,000% year to date primarily due to a group of retail
traders on Redditt who initiated a short-squeeze on the stock.
However, the company remains fundamentally weak as it ended Q1
with $813 million in cash and $11 billion in debt. It raised
capital in Q2 which will increase its cash balance to approximately
$2.2 billion in the June quarter. AMC also has $11 billion in debt
and is forecast to report an adjusted net loss of $3.16 per share
in 2021. It has 513 million outstanding shares so the net loss will
be over $1.6 billion.
Analysts also expect a
loss of $0.81 per share in 2022 which suggests AMC will have to
raise additional capital going forward, making it one of the
riskiest bets on Wall Street.
Historical Stock Chart
From Sep 2021 to Oct 2021
Historical Stock Chart
From Oct 2020 to Oct 2021