Barclays raises Moderna PT on 'transformative' melanoma vaccine potential

Barclays raises its price target on vaccine maker Moderna MRNA.O to $125 from $48 and maintains an "equal weight" rating.

The new price target implies a 13.9% downside to the stock's last close on Friday.

The increase comes a week after Moderna and Merck MRK.N reported blowout late-stage trial results for their jointly developed skin cancer vaccine, showing that the experimental treatment Intismeran, when combined with Keytruda, reduced the risk of melanoma recurrence or spread.

Barclays called the results a watershed moment for Moderna's personalized cancer treatment efforts and said Intismeran has the potential to be a paradigm shift in oncology, highlighting its broad commercial opportunity.

Shares of MRNA closed up nearly 177% after the trial results, their biggest-ever daily percentage gain.

However, Barclays analysts cautioned that because melanoma is one of the cancers most responsive to immunotherapy, a weaker result in a late-stage trial could undermine investor confidence in the vaccine's prospects not only in melanoma but also in other cancers, including renal cell carcinoma (RCC), a type of kidney cancer.

As of last close, MRNA stock was up 392% year to date.