That holding’s Moderna (NASDAQ:MRNA), the mRNA vaccine pioneer whose share price fell 45% in 2023, 58% in 2024, then 29% last year.

In 2026 however, it’s like a switch has been flipped. Year to date, Moderna’s up 73%, making it the second-best-performing S&P 500 stock so far this year. Only SanDisk, which was also the index’s best-performing stock in 2025, is doing better.

So what’s going on with Moderna? And more to the point, might the stock be worth considering today?

Slumping sales

If Moderna sounds like a blast from the past, it’s due to its indelible associations with the global pandemic. Or, more specifically, its mRNA vaccine (Spikevax) that was rapidly rolled out to millions of people worldwide.

This single product created an eye-popping $19.3bn in revenue and $8.4bn net profit in 2022. Since then though, sales have collapsed, with revenue of just $1.9bn generated last year (and a financial loss).

Naturally, sales were always going to decline significantly once the pandemic subsided and normality returned. However, they’ve fallen far faster than anticipated, while President Trump’s selection of vaccine sceptic Robert F Kennedy as health secretary hasn’t helped.

Millions more Americans are now extremely wary of vaccines, especially experimental mRNA ones. Research funding has also been pulled, leaving investors very bearish on vaccine makers.

This political development/risk was something I didn’t anticipate. But with hindsight, I should have done, as Trump had a history of vaccine scepticism predating his re-election campaign.

Why’s the stock spiking higher?

That said, I didn’t invest in Moderna just for its Covid vaccine. I did so because I thought there was a strong chance that its cutting-edge mRNA technology could be extended to other diseases, including cancer.

Developments here have put a rocket underneath the stock recently. Because Moderna and partner Merck have announced that their experimental personalised vaccine cuts the risk of death or recurrence of melanoma by 49% five years after the start of treatment.

This was consistent with data released in 2023. And it obviously bodes well for the forthcoming phase 3 data, as well as Moderna’s other eight mid- and late-stage studies in bladder, kidney and lung cancer.

Cases of melanoma, which is the most serious form of skin cancer, are rising worldwide. Analysts at Jefferies reckon this cancer vaccine has the potential to generate multi-billion-dollar peak sales in melanoma alone.

An mRNA flu vaccine should also be approved this year.

A high-risk stock

As exciting as this sounds, it’s important to not get carried away. Late-stage melanoma data isn’t expected till the end of 2026 at the earliest, and successful phase 3 clinical trials are never guranteed.

In the meantime, Moderna’s investing heavily in its large pipeline and doesn’t expect to reach cash flow breakeven till 2028.

Another thing worth mentioning is that before this news, the stock was heavily shorted, so we could be witnessing an unsustainable short squeeze. Investors should therefore be careful chasing this stock higher.

Moderna’s potential is significant, but so are the risks, and it might take years for its promise to translate into actual earnings. I’m not selling my shares, but neither am I buying more.

The post Up 73% year to date, this stock in my SIPP is suddenly on fire! appeared first on The Motley Fool UK.

That’s because the share — Moderna (NASDAQ:MRNA) — was already struggling badly. In fact, even after this double-digit rise, I’m still down 78% on my investment.

It’s fitting that it’s Halloween today, because this one has been a horror show for me. But at least it might now be coming to an end.

Pipeline problems

Moderna made a fortune from its mRNA vaccine during the pandemic. With this windfall, it invested heavily to develop and commercialise more blockbuster drugs across a range of areas, including infectious diseases, rare diseases, and immuno-oncology.

But with Covid vaccine sales dwindling, it has struggled to translate pipeline promise into actual money-making drugs. Its approved RSV vaccine has struggled to gain commercial traction, while it recently scrapped a trial to prevent CMV (a virus that can cause birth defects).

The most promising treatments are in immuno-oncology, where Moderna is using its technology to harness the body’s immune system to identify and kill cancer cells. These experimental cancer vaccines are used to treat the disease, not prevent it.

In a mid-stage trial last year, its lead candidate mRNA-4157 cut the risk of recurrence or death by 49% in melanoma patients when used with Merck‘s immunotherapy drug Keytruda.

Not only is mRNA-4157 now in late-stage trials, but it has been extended to lung, bladder and kidney cancers. So these experimental vaccines could be game-changing, both for Moderna and cancer patients.

High stakes

As exciting as this sounds, these treatments might not succeed. This is a key risk, because the company needs its pipeline to start delivering sooner rather than later.

What’s more, a personalised vaccine means it’s customised for each patient based on their unique tumour mutation profile. So Moderna must design and manufacture a custom mRNA strand.

Therefore, they could be very costly to both make and sell, turning them into a niche product. And with Moderna’s revenue expected to fall around 40% this year to somewhere between $1.5bn and $2.2bn, alongside a massive loss, the stakes could not be higher.

The company did have $7.5bn in cash and equivalents at the end of June. But that was down from $12.2bn at the end of March 2024.

The end could be nigh

Perhaps this financial ticking clock is why Moderna is looking at its options, according to a STAT News piece widely reported yesterday. This could involve bringing in a large pharmaceutical partner to help shoulder the financial burden of continuing with its oncology pipeline, or even a takeover.

Now, this is just speculation as the company has not officially commented yet. But Moderna’s Q3 results are due on Bonfire Night, so I would expect management to address this then, if not before.

Which would I prefer? Well, an acquisition would put me out of my misery, allowing me to crystallise a big loss. A significant partnership would presumably soothe investors’ nerves about cash burn, depending on the details.

Ideally, I would prefer to hop in the TARDIS and not have invested at all. But that’s a different matter.

I’ll wait to see how things play out. In the meantime, I’ll look to invest in safer UK stocks.

The post Up 14% yesterday, is it the end for this train wreck in my Stocks and Shares ISA?  appeared first on The Motley Fool UK.

As a shareholder since 2022, I’m down nearly 80% on this position, including 67% in just the past year.

Recently then, I’ve been taking a cold, hard look at Moderna. If I cannot find reasons for optimism, I’ll sell up, take my loss on the chin, and move on. Here’s what I’ve found.

Why, why, why?

As many will remember, Moderna made its name during the pandemic when its mRNA vaccine was fast-tracked for use globally. The biotech firm went from just $35m in revenue in 2018 to over $19bn in 2022. All from a single product.

This year, though, Moderna is forecasting just $1.5bn to $2.2bn in revenue — and a steep loss — as it grapples with declining Covid vaccine sales. Some may say this was bound to happen as the pandemic faded, making my investment foolish.

So, why did I even buy the stock? Well, it related to pattern recognition. Some of my best investments have been made when the market underestimates a company’s potential to become something much more valuable.

Here are three examples from my portfolio:

With Moderna, the market saw a one-trick pony with its Covid vaccine. I saw an mRNA technology platform that was potentially applicable to a wide range of diseases, including various cancers.

Since mRNA is an information-based platform, it works similar to a computer’s operating system, letting researchers insert new genetic code from a virus — like adding an app — to create a new vaccine quickly.

Moderna CEO Stéphane Bancel

Q2 update

Obviously, the only recognised pattern here has been a sliding share price. In hindsight, this makes my theory look silly.

Or does it? Because in its Q2 update, Moderna confirmed it’s still targeting another eight product approvals by 2028.

The most exciting candidates are in oncology, where it has Phase 2 and 3 trials across several cancer types, including adjuvant melanoma, non-small cell lung cancer, bladder cancer and renal cell carcinoma. 

Meanwhile, the firm’s flu vaccine recently delivered positive late-stage results, paving the way for a Covid‑flu combination vaccine.

Brokers forecast sales bottoming out this year. They then see revenue rising 20% next year to $2.3bn, followed by a further 25% jump to $2.9bn in 2027. Piper Sandler is more bullish, anticipating $4.3bn in sales by 2027 (more than double this year’s).

The biggest risk is that Moderna remains loss-making due to falling Covid sales and heavy investments in its late-stage pipeline. If its cancer vaccines ultimately disappoint, that would be a major setback.

However, the company still had $7.5bn in cash/equivalents last month. And due to cost-cutting, management says it’s on course to break even on a cash-cost basis by 2028.

My move

Weighing things up, I reckon more patience is required. So I’m going to keep holding (and praying).

Another glimmer of hope is that Wall Street’s price target of $42.85 is 55% higher than today’s level. Naturally, Moderna might never reach this, but it would be a nice boost.

Potential investors should know this is a high-risk, high-reward stock. It could generate fabulous returns from here, or flop further.

The post This S&P 500 stock could surge 55% in just 12 months, according to experts appeared first on The Motley Fool UK.

Inevitably though, I’ve got half a dozen that are stinking the place out. Two are really irritating me. Should I get rid of them?

The Nasdaq one

The first one’s my biggest loser: Moderna (NASDAQ: MRNA). The stock’s down 77% over the past year!

During the pandemic, Moderna’s mRNA Covid vaccine was administered into hundreds of millions of bodies. Those hundreds of millions of jabs quickly translated into many billions of dollars of profit.

Of course, that was never going to last, and when I invested in 2023 the share price was already down around 70% from its pandemic peak. Unfortunately, it’s headed even lower since, as declining Covid sales have not been offset by new approvals.

So what possessed me to invest? Well, Moderna’s mRNA technology works a bit like software for the body. As Moderna CEO Stéphane Bancel puts it: “With mRNA, it’s four letters [A, T, C, G], like zeros and ones with software. You code everything.”

In theory, this digital-like platform model gives Moderna huge scalability advantages. It can be adapted for a potentially wide range of uses, from flu and HIV to personalised cancer vaccines.

Management’s targeting up to 10 new product approvals over the next couple of years. Its second mRNA vaccine, for respiratory syncytial virus (RSV), is already on the market.

Meanwhile, it’s vaccine for skin cancer has shown great promise. In a phase 2 study, it demonstrated a 49% reduction in recurrence or death. Moderna has various cancer vaccines in the clinic, including for lung and bladder cancer. They could be game-changers, for both patients and Moderna.

However, while these vaccines have blockbuster potential, there’s no guarantee they’ll get approved by regulators. Moreover, the Trump administration’s ambivalent view on vaccines, to put it mildly, is a challenge. Funding for a potential bird flu vaccine was recently pulled.

Moderna expects to end 2025 with $6bn in cash. And analysts see revenue growth resuming in 2026, rising 16% to $2.4bn. Then up another 25% to $3bn in 2027. No profits though.

I’m hanging on to my shares, but it’s a long way back.

The Footsie one

The second struggling stock is JD Sports Fashion (LSE: JD). While the share price has jumped 22% in the past week, I’m still down around 17% after investing last year.

JD’s been hurt by a slowdown in consumer spending. We don’t know when that will improve, and it could even get worse. This is the key risk here.

Yet the company’s still opening stores worldwide, and grew its sales 10% to £11.5bn during the year to 1 February. The shares have been rising because investors are backing a potential return to growth at key partner Nike.

JD shareholders will hope so, as Nike’s products account for around 45% of total sales. And the two share prices tend to move in lockstep.

However, the sportswear retailer also sells trend-driven brands such as On and Hoka. While Moderna’s more of a speculative moonshot, I reckon JD Sports deserves further attention from investors.

The stock’s trading at just 7 times forward earnings, which still appears far too cheap to me.

The post These FTSE 100 and Nasdaq stocks are stinking out my ISA! Should I dump them? appeared first on The Motley Fool UK.

A falling knife

Let’s start with Moderna (NASDAQ: MRNA). I first bought the shares in 2022 after they’d dropped 50%, then doubled down at the start of 2024 when they dipped below $90.

Now they’re at $32 after falling 20% year to date.

Now, I didn’t go in totally blind about Covid vaccine sales. I knew they’d fall once everyone got back to normality. I still remember how groggy I was after my first pair of jabs, and I’m not overly keen to feel like that again.

However, I thought sales would prove durable enough to see the biotech firm through to the next (more exciting) phase of its development. That would involve a new class of mRNA medicines for heart disease, cancer, HIV, and more.

The worst of both worlds has happened — Covid sales have fallen off a cliff and no blockbuster has yet been developed to take their place. Revenue has gone from $19bn in 2022 to an expected $1.5bn-$2.5bn this year. That wide range tells us that demand is very uncertain.

Something I didn’t foresee was the election of Donald Trump and the subsequent appointment of vaccine sceptic Robert F Kennedy Jr as health secretary. mRNA vaccine technology appears to be directly in the administration’s firing line, so this is adding more risk.

Of course, politics is outside Moderna’s control. It had its second product — for respiratory syncytial virus (RSV) in adults aged 60 and above — approved last year, but it hasn’t been selling well.

Nevertheless, the company has ambitious plans to launch 10 products by 2027. And its potentially groundbreaking personalised cancer vaccine is currently in a Phase 2/3 trial for melanoma in collaboration with Merck.

Losses are expected for years, but Moderna did still have $9.5bn in cash at the end of 2024. It’s in no immediate danger.

I’m going to hang onto my shares and ride out the vaccine-related political storm. But it’s a long way back from $32.

Weight-loss woes

The second stock stinking out my ISA is Novo Nordisk (NYSE: NVO). It’s down 10% in 2025 and 38% over the past six months.

Novo Nordisk is a diabetes care giant that’s also behind the blockbuster GLP-1 drugs Ozempic and Wegovy. These have been selling like hotcakes, but a recent phase 3 trial to find a significantly better weight-loss treatment fell short.

Meanwhile, competition is heating up from weight-loss rival Eli Lilly, while Roche is attempting to muscle its way into this lucrative space. So rising competition is a risk worth monitoring.

Unlike Moderna though, I’m confident this stock will bounce back. Novo has high margins, strong R&D investment, and a powerful market position with Ozempic and Wegovy.

Indeed, surveys show that many patients specifically request these by name, rather than asking about ‘GLP-1 drugs’ generally. The firm recently launched a direct-to-consumer platform that allows eligible patients to purchase Wegovy online for $499 per month.

Finally, the stock is trading at an attractive 19 times forward earnings, while offering a 2.1% dividend. I’m more likely to buy additional shares than sell at that valuation.

The post 2 growth shares stinking out my Stocks and Shares ISA in 2025! appeared first on The Motley Fool UK.

For example, Amazon started life as an online book store. Fast forward to today, books are a tiny fraction of the overall business. Much of Amazon’s value now comes from AWS, its cloud computing platform

Nvidia‘s another prime example of a company that’s transformed itself. Its graphics processing units (GPUs) were originally designed to improve computer game images, not power a global artificial intelligence (AI) revolution.

Both stocks have delivered massive returns over the past 20 years.

I thought something similar could happen with Moderna (NASDAQ: MRNA). Its vaccines gained widespread recognition during the pandemic when they were deployed to combat the Covid virus. However, the underlying mRNA technology has far-reaching potential beyond Covid, with applications that include vaccines for HIV, respiratory syncytial virus (RSV), and even personalised cancer treatments.

Alas, that investment case is looking threadbare right now, with Moderna stock falling 66% in the past 12 months. It took another 16% tumble on 13 January, adding insult to my already badly injured holding.

What’s gone wrong with this supposed growth stock? Let’s dig in.

Falling sales

The big problem is that Moderna’s revised its sales forecasts downward multiple times in recent months. It was at it again this week, when management lowered its 2025 sales guidance by $1bn.

It now sees revenue landing between $1.5bn and $2.5bn, rather than its previous September guess of $2.5bn to $3.5bn. For context, it achieved around $3bn in product sales last year.

These incredibly wide ranges tell us that the firm hasn’t really the foggiest about true demand for its two vaccines (Covid and RSV for adults aged 60 years and older). Whether because of vaccine fatigue or misinformation, less people are getting inoculated.

The firm had originally intended to break even on an operating cash basis by 2026. Then it was pushed back to 2028. Now, with sales still under huge pressure, even that might prove optimistic. Actual profits appear a distant prospect.

Some good bits

On the plus side, the firm’s identified cost reductions of $1bn this year and $500m in 2026. It expects to finish 2025 with about $6bn in cash. So Moderna isn’t in any immediate existential danger.

CEO Stéphane Bancel said: “We remain focused on our three strategic priorities: driving sales growth, delivering up to 10 product approvals over the next three years, and reducing costs across our business.”

It’s encouraging that Moderna’s still aiming to deliver up to 10 new products over the next three years, including three approvals this year. This includes potentially expanding its RSV vaccine to younger patients and a flu/Covid combination vaccine.

Should I sell?

I thought Moderna would use its pandemic windfall to rapidly diversify always from Covid sales before they evaporated. This hasn’t happened yet, and its new RSV vaccine’s struggling to get off the ground.

Looking ahead, there’s still Moderna’s late-stage personalised cancer vaccine, in development with Merck. This was shown to reduce melanoma spreading, or death, by 62% when combined with Merck’s Keytruda therapy. The companies have quickly expanded their research to other types of cancer. 

These cancer vaccines could still be revolutionary, so I’m going to keep holding my shares.

The post Moderna’s meant to be a red-hot growth stock. What on earth’s gone wrong?  appeared first on The Motley Fool UK.

Already though, I’m aware of a loss-making error that has taken the shine off my overall portfolio performance.

Here is the ISA mistake I’m keen to avoid repeating in 2025.

Doubling down

You don’t have to get it back the way that you lost it.

Warren Buffett

Axon Enterprise has been my biggest winner in 2024. Shares of the Taser maker are up a stunning 154%!

They’ve now surged 782% over five years.

However, I culled this top performer a while back, taking some profits as it mushroomed into a mammoth holding in my ISA.

Now, there’s nothing inherently wrong with that. It’s still a top position in my ISA (and SIPP), and I’m more than happy with it. It’s how I recycled some of those gains that’s come back to haunt me.

That’s because I added to my holding in mRNA vaccine pioneer Moderna (NASDAQ: MRNA) at the start of 2024. That position has fallen, along with my previous two purchases.

In fact, the stock has crashed 71% in six months and 45% over one year! The stock has turned into a giant red weed in my portfolio.

All in all, I’m down 65% on this share. Ouch.

What’s gone wrong?

Moderna was one of a small handful of companies whose vaccines came to the rescue during the pandemic. Its mRNA platform enabled the rapid creation of Spikevax in record-quick time.

It was the potential scalability of the biotech’s platform, and what diseases it could address outside of Covid (including cancer), that attracted me to the stock. But Moderna’s new vaccine for respiratory syncytial virus (RSV) hasn’t done very well, while Covid sales continue to fall off a cliff.

In August, the firm lowered its annual sales guidance by as much as $1bn, to $3.0bn-$3.5bn. And it doesn’t expect to break even on an operating cash cost basis till 2028, rather than 2026 as originally planned.

Meanwhile, Donald Trump’s nomination of vaccine sceptic Robert F. Kennedy Jr. for a potential political role in health isn’t exactly helping sentiment for the stock. So there are plenty of risks here.

On reflection though, my investment thesis remains just about intact. The company is still targeting 10 product approvals over the next three years, while reducing its cost structure.

Successful product launches aren’t guaranteed. But I’m encouraged that the probability of Moderna’s drug candidates progressing from phase one to phase three trials is roughly six times higher than the biopharma industry average. 

This highlights the exciting potential of the platform. However, the firm will have to start turning promise into performance through better execution for the stock to rebound and do well.

Foolish takeaway

Looking back, what I did was cut the flowers (Axon) to water the weeds (Moderna). That was a cardinal investing mistake, and one which I won’t be repeating again.

Looking ahead, I see plenty of opportunities, whether in growth stocks or high-yield income shares. With careful selection, 2025 could be a year of substantial gains for those ready to seize these opportunities.

The post 1 ISA mistake to avoid in 2025 appeared first on The Motley Fool UK.

However, savvy investors who bought in four years ago have made more than 10 times their money by now!

Unfortunately, I only got on board when the stock was already on the way up at 149p. But Rolls-Royce shows the sort of dramatic gains that can be secured when a struggling firm wins back the confidence of investors.

Today, at 547p, Rolls-Royce is trading at around 30 times this year’s forecast earnings. That’s a punchy valuation, especially when the widening Middle East conflict could disrupt the company’s supply chains.

The consensus price target among analysts is only 6% above the current level. So I think it’s safe to assume we won’t be seeing the Rolls-Royce share price rise tenfold again any time soon.

That household name I mentioned

By contrast, Wall Street currently has a $98 target on shares of Moderna (NASDAQ: MRNA). That’s around 70% higher than the present $57.

The firm became a well-known name during the pandemic when its vaccines were among those that came to the rescue. Since then though, vaccine fatigue has set in among the public and sales have dropped off a cliff.

The stock is down 42% this year alone and 87% from a 2021 high of $449.

Inflicting further pain on myself, I’ve just checked my portfolio. This shows my holding in Moderna is now down 60% after I bought shares three times between between mid-2022 and early 2024. Ouch.

What on earth has gone wrong here?

Loss of confidence

Put simply, the market has lost faith in management’s ability to accurately forecast demand for Covid (or any other) vaccine sales. In September, the biotech firm adjusted its 2025 revenue guidance, from $3bn-$3.5bn to $2.5bn-$3.5bn. Basically, it widened the range, but not in the direction investors wanted.

It also now expects to reach operating cash flow breakeven in 2028 instead of 2026. It has nearly $8.5bn in cash, which it reckons will be enough to get it there. But with sluggish sales and ongoing losses, there’s plenty of risk here.

Patience needed

I invested in Moderna because its messenger RNA (mRNA) platform has the potential to be highly scalable and go well beyond Covid.

CEO Stéphane Bancel said: “With mRNA, it’s four letters, like zeros and ones with software. You code everything.” This means the platform has digital characteristics, where more data leads to better results. This is unlike traditional pharmaceutical approaches, where a hit with one drug reveals nothing about the success of another.

According to Moderna, the probability of its drug candidates progressing from phase one to phase three trials is approximately six times higher than the industry average. And despite the near-term challenges, the company still expects to launch 10 products in the next three years across three therapeutic areas.

If the stock ever recovered to reach it’s previous height of $449, then we’d be looking at Rolls-Royce-type returns from $57 today. Of course, that’s a long shot and certainly won’t happen overnight. Moderna needs to start winning back investor confidence first.

But given the potential, I’m going to keep my shares.

The post Down 87%, is this once-famous stock set to explode like the Rolls-Royce share price? appeared first on The Motley Fool UK.

There are a handful, actually. But until recently, Moderna (NASDAQ: MRNA) wasn’t one of them. That’s because sales of the firm’s only product, the Spikevax Covid vaccine, have been declining rapidly as the pandemic fades in the rear-view mirror.

In 2022, the company generated nearly $19bn in sales. This year, it’s only expecting $4bn.

However, 2024 might prove to be an inflection point for this digital biotech stock. Here’s why.

Two-product company

In late May, the company received approval for mRESVIA, a vaccine for respiratory syncytial virus (RSV). This causes mild, cold-like symptoms but can lead to serious respiratory illnesses, especially in infants and the elderly.

This was the first approved mRNA vaccine for a disease outside of Covid. But this isn’t the only RSV shot. GSK and Pfizer both had theirs approved 12 months ago.

However, Moderna’s vaccine is the only one to come in a pre-filled syringe. This compares favourably with the multi-step process of its competitors’ products.

Here’s what Moderna’s CFO James Mock said about these rival RSV jabs: “So you have to mix it and swirl it and then take a jab and measure it out. And so that is prone to error or breakage and that is cost.”

He believes that busy pharmacies and healthcare providers will buy in to its more efficient administration method. And despite being late to the party, he estimates that the firm has a good chance of capturing at least an equal share (33%) of this large market over time.

A risk to consider

Now, I should note that the firm is currently generating losses as it invests in its various programmes.

This isn’t a problem yet as it still had $12.2bn in cash and investments, as of 31 March. And the company expects to break even in 2026 through product launches and disciplined investment.

But investors will want to monitor how quickly this war chest starts to dwindle over the next couple of years. It always adds risk to the investment case when a firm is loss-making.

More positive news

Yesterday (10 June), the firm announced that its combined flu-Covid jab provoked a higher immune response when compared to separate shots (including its own Spikevax) in a late-stage trial.

If approved, this 2-in-1 jab could upend the global flu vaccine market. “This is a home run,” CEO Stéphane Bancel told Barron’s. “The whole field has been waiting for something like this.”

He estimates that the total addressable market could go up by three times compared to Covid alone.

Looking ahead, Moderna says sales from its collection of respiratory vaccines could be between $8bn-$15bn in 2027. So, the company may more than treble its sales over a three-year period.

By that point, we might also have approvals for one of its experimental mRNA cancer vaccines that are currently in phase 2 and 3 studies for several types of cancer.

There are also vaccine candidates for HIV, Zika and cytomegalovirus. The future suddenly looks very exciting. As a result, I’m going to add more shares to my portfolio for the long term.

The post 1 exciting growth stock to buy for the long run in June appeared first on The Motley Fool UK.

Clearly, Nvidia‘s staggering performance has helped, as has strong share price gains for Temu owner PDD Holdings over the last year.

Meta Platforms stock has also done well since it was reintroduced into the portfolio a few months ago.

This is encouraging because these are large Scottish Mortgage holdings. The picture isn’t as pretty down the bottom of the portfolio, but that shouldn’t be a big negative long term. It’s the top end that really matters.

Here, I’ll consider one major holding that has also been surging higher recently. Given its heavy weighting, it could boost further returns for the trust if progress continues.

Bird flu outbreak

I’m talking about messenger RNA (mRNA) vaccine pioneer Moderna (NASDAQ: MRNA). The stock has been on a tear, doubling in value since November.

This is partly down to an outbreak of bird flu spreading among dairy cows. Moderna shares have risen 35% since 1 April, when the second known human case in the US was reported.

A third person recently tested positive after having contact with cattle carrying the H5N1 virus. And while no human-to-human transmission has been reported yet, the US government isn’t taking any chances.

Reports say federal funding could be heading the way of Moderna and vaccine rival Pfizer to test experimental shots against several strains of the virus (including the circulating one).

On 30 May, Moderna told Reuters that it had already completed dosing in an early-to-mid stage study of the vaccine, and it expects data from this soon.

A software firm in disguise

In a nutshell, we have here the reason why Scottish Mortgage managers believe Moderna could become a transformational growth company.

The speed at which its mRNA platform can tweak code to summon up effective vaccine candidates on demand is astonishing. This is why I’m invested in this stealthy software company.

Just as Nvidia’s GPUs have uses beyond computer graphics, mRNA technology offers a wide range of applications outside of Covid vaccines.

Already, we’re seeing very encouraging data from trials of a personalised mRNA skin cancer vaccine that activates the body’s immune system to identify cancerous cells and remove them.

There’s the potential this could work in indications outside melanoma, with trials for non-small cell lung cancer vaccines ongoing.

Above £10?

Naturally, there are risks with Moderna, as there are with Scottish Mortgage shares. One is a return of inflation, which could keep interest rates higher for longer and heap pressure on both share prices.

Plus, Moderna’s at the mercy of clinical trials, which can always go wrong at any stage. It has over 40 drugs in development, including a vaccine for AIDS. Crucially though, it has the wherewithal ($13.3bn at year-end) to fund these programmes.

On 31 May, the company had its second mRNA product approved for respiratory syncytial virus (RSV). It expects to return to sales growth in 2025 following a massive post-Covid drop-off in demand.

If more progress follows in the coming months, I expect excitement to build and potentially push Scottish Mortgage shares above £10.

The post 1 intriguing growth stock that could send Scottish Mortgage shares above £10 appeared first on The Motley Fool UK.