Valneva (+6.32%, at 4.006 euros)

Valneva stands out on the SBF 120 following a note from Stifel, which reaffirmed its Buy recommendation on the stock, accompanied by a slightly increased price target from 9.50 to 10 euros. This represents an upside potential of 165.39% compared to Monday's close. The American investment bank is especially optimistic about Valneva ahead of the phase III results for VLA15, a vaccine developed with Pfizer against Lyme disease, expected in the first half of 2026.


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Key Points

 - Specialist in the development of prophylactic vaccines against infectious diseases with limited therapeutic options;
- Revenue of €153.7 million, with 56% generated in Europe, ahead of the Americas (27%), then Asia-Oceania (9%) and Africa-Middle East (8%);
- Ambition to create vaccines for diseases with no existing solutions, with two major milestones: 2024 for the commercial launch of the chikungunya vaccine Ixchiq, and 2027 for the Lyme disease vaccine;
- Capital held at 6.2% (10.36% of voting rights) by the Grimaud la Corbière group and 6.22% by BPI France, with Anne-Marie Graffin chairing the board of 6 directors and Thamas Lingelbach serving as CEO;
- Governance changes expected by year-end, moving to a board of directors and executive committee.

Challenges

- Agility of the business model:
                  - control of the value chain from research to commercialization,
                  - enhancing group assets through partnerships,
                  - funding clinical developments via a specialized infrastructure marketing three commercial vaccines (Ixiaro for Japanese encephalitis, Ixchiq for chikungunya, and Dukoral for cholera) and through rights from third-party vaccine distribution,
                  - financial security, with cash covering operational needs through 2027,   
                 - innovation backed by a portfolio of over 400 patents with 2 main assets and 3 preclinical programs: the only clinical-stage vaccine for Lyme disease, the only single-injection vaccine for chikungunya, and 3 vaccine candidates targeting Zika virus, Epstein-Barr virus, and human metapneumovirus;
- Environmental strategy: energy efficiency, waste minimization, optimal water use, and a 5% reduction in CO2 emissions by 2025 versus 2016;
- Strong business visibility thanks to vaccine agreements with:
                  - Pfizer for co-development and sale of the Lyme disease vaccine ($308 million),
                  - U.S. authorities for Ixiaro against Japanese encephalitis ($70 million),
                  - Bavarian Nordic for marketing and distribution of specialized vaccines,
                  - Batavia Biosciences for development of a low-cost polio vaccine,
                  - Instituto Butantan for chikungunya vaccine in low-income countries;
- Solid balance sheet with €128 million in equity, bolstered by a net cash position of €126 million at the end of March.

Challenges

 - Commercial results from the launch, secured by €100 million in private financing and over $40 million from Cepi and the European Union, of Ixchiq, the world’s only authorized chikungunya vaccine, approved by Canada and the European Union;
- Results of phase 3 trials for the Lyme disease vaccine after completed recruitment, in partnership with Pfizer, which will file a submission in 2026;
-  Seeking partnerships for research on the human metapneumovirus vaccine and expanding the manufacturing network (3 sites in Scotland, Sweden, and Austria),
- After a positive first quarter (€177 million in cash and net profit of €59 million after asset disposals), 2024 guidance was raised: revenue between €170 and €180 million and R&D expenses between €60 and €75 million;
- 2026 objective to achieve net profitability through doubling sales, driven by Ixchiq and Ixiaro, ahead of the expected market launch of the Lyme disease vaccine in 2027.