Shares of Inovio Pharmaceuticals (NASDAQ: INO) were down 14.11% premarket despite the company reporting positive results from its phase 1 clinical trial. The biotech company’s stock has rallied over 110% this month to trade near a 20-year high of $33.78, which could explain its latest decline.
The stock’s recent rally was driven by the $71 million contract awarded to the company by the Department of Defence for its vaccine delivery service, which triggered the rally starting June 22. The company’s shares were still down a few minutes to the market open.
Inovio Pharmaceuticals share price
Investors could also be reacting to a recent analyst downgrade of the stock to neutral from buy citing its recent rally, hence, the stock is likely due for a pullback. The company’s shares are up 746.9% since January 23 after getting funding for its coronavirus DNA vaccine.
The latest trial involved older participants who are at greater risk of major illness and even death from the novel coronavirus. The firm confirmed that the phase 2 and 3 trials would commence this summer.
Today’s decline seems like a classic ‘buy the rumour, sell the news scenario’ and given the stock’s parabolic rally, I would say that it is overdue for a pullback.