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Novavax (NASDAQ:NVAX) stock could trade in the $100 billion market capitalization range like BioNTech (NASDAQ:BNTX) or Moderna (NASDAQ:MRNA). Except, unlike those companies, Novavax has not yet delivered.

It might be among the most-watched firms that did not yet bring a Covid-19 vaccine to market.

Chances are low that it will slump like Altimmune (NASDAQ:ALT) after it discontinued its nasal Covid-19 vaccine.

By comparison, Inovio Pharmaceuticals (NASDAQ:INO) is on the mend after Brazil approved its vaccine candidate.

If Novavax can get its act together soon, it could take the kind of ride that makes people wish they had gotten in sooner. Let’s take a closer look.

Approval to Lift NVAX Stock

A European Union official told Reuters that the bloc expects Novavax will submit key data soon. It needs to complete the submission of the data to the European Medicines Agency before it can get Europe’s approval.

According to the EU official, this might happen by the end of September. Once it does, Novavax may fulfill its deal to supply up to 200 million doses.

The official spoke under the condition of anonymity. Novavax did not offer any hints on its timeline nor did it explain the reasons for delays in supplying the data.

The longer it takes to ship a product, the more market share it loses to other vaccine suppliers. The EU official said a decision on the vaccine approval was still possible this year, “as long as there are no more delays.”

Big Loss in Q2

In the second quarter, Novavax’s revenue grew by 738.5% to $298.02 million. It lost $4.75 a share on a GAAP basis.

The big loss is immaterial because markets are valuing the company based on its vaccine sales. The company claimed it is on track to achieve 100 million monthly doses by the end of the third quarter. By the end of Q4, it will supply 150 million doses.

“Our clinical successes over the second quarter reaffirm our confidence in NVX-CoV2373’s differentiated efficacy profile,” said Novavax President and Chief Executive Officer Stanley C. Erck.

His confidence suggests that the company will not post any disappointments in its clinical study results.

“We continue to see the circulation of new variants and inequitable access to vaccine globally,” he added.

Even though Novavax is the latest in bringing a vaccine to the market, the recurring demand will sustain shipment volumes. Not only will countries need the vaccine for booster shots but variants of concern could require vaccinations twice a year.

Opportunity

Moderna and BioNTech demonstrated strong initial protection against the variant but it is not 100%.

Countries will want another vaccine offering lower hospitalization rates from the delta variant. Novavax has the World Health Organization’s support.

On Aug. 5, it filed a EUA to regulatory agencies in Indonesia and the Philippines. Novavax said it would file for WHO emergency use next.

Novavax’s manufacturing capabilities are ready to fulfill vaccine orders once it receives regulatory approval.

It also has Japan as one of its customers ready to take delivery. In February, Novavax and Takeda (NYSE:TAK) finalized a licensing agreement. Takeda will develop, manufacture, and commercialize Novavax’s NVX-CoV2373 vaccine candidate.

Valuation

Moderna and BioNtech’s multi-bagger returns in the last year suggest that NVAX stock has more room to run higher.

Markets will pay a rich valuation for NVAX sstock. In May, Novavax’s FDA approval delay sent the stock to $120. Within weeks, bullish investors quickly scooped up shares.

On Wall Street, four analysts offer a one-year price target on Novavax. The average price target is around $277, according to tipranks. The target range is between $235 and $305.

Investors are better off accumulating NVAX stock than on speculating on Inovio or Altimmune.

Novavax ended the second quarter with $807 million in cash. Its cash position grew to $1.1 billion due to payments from advanced purchase agreements.

The strong balance sheet will fund Novavax’s operational costs. Conversely, the smaller biotech firms face constant cash flow challenges. They need to raise cash, often from selling shares, to fund research activities.

Few investors stayed the course holding BNTX and MRNA. Those who missed out on the gain may consider NVAX stock from here.

The market is not yet saturated with Covid vaccine suppliers, and so far the market is confident that Novavax will become the next major vaccine supplier globally.

On the date of publication, Chris Lau did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris Lau is a contributing author for InvestorPlace.com and numerous other financial sites. Chris has over 20 years of investing experience in the stock market and runs the Do-It-Yourself Value Investing Marketplace on Seeking Alpha. He shares his stock picks so readers get original insight that helps improve investment returns.

Timing a market bottom is a notoriously difficult thing to do. So, I won’t claim that now is the definitive time to invest in Alibaba (NYSE:BABA) stock.

However, pundits have to admit that the case for maximizing returns by buying low looks very near. 

The truth is that Alibaba was never likely in any jeopardy of being broken up by the Chinese government. Many commenters and writers have continually banged the drum that BABA stock will rebound since its woes began late last year. 

The latest news that Alibaba is investing in President Xi Jinping’s initiatives should lessen any remaining doubt about its trajectory: Alibaba is rising again, making BABA stock easy pickings.

Common Prosperity and BABA Stock

An Aug. 17 speech by Chinese President Xi Jinping has resonated across the country’s economy. The speech focused on common prosperity and a rational adjustment of excessive incomes. It was aimed at the redistribution of wealth in which higher-income individuals and companies contribute more to society. 

China’s tech giants and leading companies spanning industry have clearly understood its import, and are toeing the line. 

Alibaba has pledged to invest $15.5 billion in Xi’s initiative by 2025(1). Beijing is proving that it wields a firm hand over its economy. While that may have appeared to be less the case a year ago, the case is clarifying: The Chinese economy has strong capitalist tendencies but Beijing runs the show.

I’m not here to argue that vis-a-vis the U.S. approach, simply to note that Alibaba is playing the game and won’t be going anywhere anytime soon. 

Where Will the Money Go?

Zhejiang News, a Beijing-backed website, says the money will go towards subsidies for small and medium enterprises and improving insurance protection for gig-economy workers. 

Alibaba will also be setting up a $3.1 billion common prosperity development fund. There are investors who will despise the moves and the broader implications, but this is the game. 

In fact, Alibaba is simply one among many Chinese companies which is stepping in line with the Beijing dictate.

Tencent made a similar 100 million yuan ($15.5 billion) fund. It is no surprise that two of China’s biggest tech firms that gobbled up startups last year are stepping in line this year. The Chinese government is stern and powerful, as both have clearly seen. 

Pinduoduo (NASDAQ:PDD) recently hit a milestone, posting its first quarterly profit since listing back in 2018. It will donate all $374 million to support agriculture and rural development.

Pinduoduo has also pledged to do the same with up to its next 10 billion yuan ($1.5 billion) in profits. 

Although Alibaba looks to be clear of Beijing’s heavy hand, all of this does leave Alibaba investors in a precarious position. 

Blunted Future?

The broader picture is that Alibaba will give away as much as $20 billion in support of President Xi’s ‘Common Prosperity’ initiative between now and 2025. 

On the one hand, Alibaba is doing what it must in the face of Beijing’s might. Therefore, it should rise. The move is a clear sign that its prospects should be immediately improved. 

But on the other hand, it is problematic. The optics of the common prosperity initiative and the response of Chinese companies raise serious questions. Who’s to say that Alibaba won’t be squeezed again in the future? How much will those billions in donations affect the company? 

While I think BABA stock is investment worthy now, I would caveat that the situation bears serious scrutiny. I would invest now, but withdraw if a similar situation crops up. 

Alibaba’s profits increased 22% in the last quarter and it has Beijing behind it. It should rise. If that is fine for you as an investor, there’s money to be gained.

On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Alex Sirois is a freelance contributor to InvestorPlace whose personal stock investing style is focused on long-term, buy-and-hold, wealth-building stock picks. Having worked in several industries from e-commerce to translation to education and utilizing his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.”

Allegations of fraud against Cassava Sciences (NASDAQ:SAVA) are unlikely to stop its Alzheimer’s drug candidate from quickly advancing to a Phase 3 clinical trial. As a result, I remain very bullish on SAVA stock.

One of the most important reasons is an issue that hasn’t been explored very much yet. Specifically, none of the allegations against Cassava relates directly to the most recent safety and cognition data on its Alzheimer candidate, simufilam.

That safety and cognition data, released on July 29, was incredibly positive, as simufilam did not cause any major adverse side effect, and apparently became the first drug to improve Alzheimer’s patients’ cognition levels after nine months.

Vigorously Debating the Trees and Ignoring the Forest

The Citizen’s Petition to the FDA that started this controversy was submitted by attorney Jordan Thomas and published on Aug. 22. Basically, it focuses on using technical analysis to question the integrity of studies carried out in the lab of an associate (but not an employee) of Cassava, Dr. Hoau-Yan Wang, who is a professor at City University of New York. Wang serves on the company’s scientific advisory board.

Dr. Lindsay Burns, Cassava’s vice president for neuroscience, co-authored several papers that were based on the data whose integrity is questioned by the petition.

Thomas also claims that Cassava has been using brains that were too old to test its drug and that only Wang’s lab has reported a connection between the protein that simufilam affects and Alzheimer’s.

Assessing the merit of the technical accusations is way beyond my expertise. But gauging the likely impact of those accusations on SAVA stock is well within my purview.

And, as I indicated earlier, I think, while so many have focused on debating the merits of Thomas’ accusations, nearly everyone is ignoring a crucial point: There appears to have been no credible accusations against the safety and cognition data that Cassava unveiled on July 29.

What’s more, Thomas’ accusations primarily relate to the measurement of biomarkers used to determine the presence of proteins associated with Alzheimer’s in patients’ brains. Yet, for Phase 2B data reported by the company, an independent company, Quanterix (NASDAQ:QTRX), assessed the biomarkers, according to Cassava. Quanterix has not denied that assertion. And no one, as far as I’ve seen, has contested the accuracy of the cognition and safety data released on July 29.

Moreover, no independent expert that I’ve seen has corroborated Thomas’ points about using brains that are too old, and, as I noted, Quanterix has confirmed Cassava’s biomarker data. As a result, the only arguments Thomas makes that seem valid are his attacks on the integrity of Wang’s experiments.

So, while many people are debating the trees (the charges regarding the integrity of Cassava’s old papers), nobody appears to have realized that the forest (the company’s great, undisputed safety and cognition data) is hundreds of time more important.

The Impact on the Alzheimer’s Treatment

I would not rule out the possibility that most of Thomas’ charges about Wang’s lab are true. After all, multiple experts who claim to be free from any conflicts of interest say that the allegations have merit.

Thomas asks the FDA to “halt” upcoming Phase 3 trial of simufilam and conduct audits of multiple aspects of Cassava’s prior work. That would delay the drug’s availability for years, potentially costing millions of Alzheimer’s sufferers a year or two of much better quality of life.

I’m not surprised that Thomas is making these arguments. Someone is obviously paying him to try to derail Cassava’s drug, and lawyers are trained to find the best available arguments that support their missions.

Also, our legal system embraces the idea of ignoring crucial evidence because the person or people who provided that evidence did something improper. For example, evidence in a criminal investigation that’s obtained illegally is sometimes ruled inadmissible in courts, at times ruining prosecutors’ entire cases and allowing obviously guilty people to go free. And if a trial witness is found to have lied about one issue or done something wrong in the past, opposing lawyers argue that everything he or she says is worthless.

But should we use the same principle when it comes to drugs that could save or greatly improve the lives of literally millions of people? Taken to its logical extreme, that concept is totally ridiculous and very dangerous.

For example, what if we somehow found out now that data from the early studies of a drug that’s greatly prolonging the lives of AIDS patients was falsified? Should we recall the drug until all of the studies on it can be audited, potentially condemning tens of thousands of people to much earlier deaths and much greater suffering? Or should we rely on all the subsequent evidence we obtained that the drug is safe and effective and keep prescribing the drug? I think the answer is pretty obvious.

Likewise, the idea of potentially causing hundreds of thousands of Alzheimer’s patients to suffer needlessly because a professor may have faked some data in early tests should be viewed as an idea that violates common sense.

Other Important Points

As many others have pointed out, the FDA quite correctly appears to be moving ahead with the Phase 3 trial of Cassava’s simufilam, despite Thomas’ petition. The agency did, after all, issue the protocols for the Phase 3 trial several days after receiving Thomas’ petition.

Also importantly (and I haven’t seen anyone else point this out), just because Burns authored or co-authored papers about the data generated by Wang’s lab does not mean that she was closely involved with or even knew about any improper activities that may have gone on there. I highly doubt whether she spent much time at the lab carrying out experiments.

Also worth noting is that Dr. Nadav Friedmann, Cassava’s chief medical officer, and Dr, James Kupiec, its chief clinical development officer, both appear to be Burns’ supervisors. Both spent many years working in responsible positions for large, well-known pharmaceutical companies. Friedmann was CEO of Daiichi Pharmaceutical Corporation (OTC:DSNKY) and Kupiec was a vice president for Pfizer (NYSE:PFE).

The Bottom Line on SAVA Stock

Fraud that may or may not have been committed at Wang’s lab will not be allowed to invalidate the unchallenged safety and cognition results of Cassava’s recent study or delay its upcoming Phase 3 trial. Therefore, long-term investors should buy SAVA stock on its current weakness.

On the date of publication, Larry Ramer held a long position in SAVA stock. 

Oil prices pushed past $70 for the first time in a month in late-day trading Thursday. The rally is breathing new life into the energy sector, which is up 2.5% at this writing. For the past quarter, energy stocks have been lagging the broader market, so shareholders are cheering the newfound strength. To celebrate the potential breakout, I’m highlighting the best three energy stocks to buy.

My process for finding today’s targets was simple. First, I sorted a list of the most liquid oil-related stocks by percentage change and focused on the biggest gainers. Second, I reviewed the chart of each to settle on the cleanest patterns. Despite today’s jump, many remain in downtrends and still need time to set up a trading opportunity properly.

To round out the trio, I included a sector fund to provide a diversified way to play.

• Energy Sector Select SPDR Fund (NYSEARCA:XLE)
• Conoco Phillips (NYSE:COP)
• Hess Corp (NYSE:HES)

After performing technical analysis on each chart, I’ll build out a smart options trade to profit.

Energy Stocks to Buy: Energy Sector Select SPDR Fund (XLE)

While XLE may not be ready for a directional trade due to the multiple overhead resistance zones, it does appear stable enough to warrant a cash flow play. I’m thinking naked puts. Thursday’s climb created a higher pivot low for the fund. As a bonus, we bounced right at the rising 200-day moving average. You’ll recall that higher pivots denote increasing demand.

The 50-day moving average and old resistance zones loom overhead and need to be taken out before the trend fully turns higher. In the meantime, I think today’s jump gives the green light to at least selling out-of-the-money puts.

The Trade: Sell the Oct $44 put for 60 cents.

Consider it a bet that XLE stays above $44 for the next 43 days. If it does, then you’ll pocket the max gain of $60 per contract.

Conoco Phillips (COP)

Conoco Phillips has the best-looking chart of all the largest players. It is, therefore, my stock of choice if you want a lower volatility play. My analysis for COP stock mirrors XLE. The higher pivot low just formed gives bulls a slight edge, but major resistance at the 50-day moving average and the cluster of swing highs near $57.50 require keeping our optimism in check.

You could wait for a breakout, then go directional with a call spread. Or, sell naked puts or put spreads now as a wager that prices will at least hold steady for the next few weeks. To give a bit of variety to today’s trade ideas, let’s build out a call spread. Be sure to wait until COP stock rises beyond $57.50 before pulling the trigger.

The Trade: Buy the Nov $57.50/$62.50 bull call for around $1.70.

Hess Corp (HES)

The final of today’s energy stocks provides the most volatile option. This can be both a boon and a curse, but I’m banking on it, working to our advantage if oil prices continue to rise. Thursday was a victory for HES stock in two ways. First, it pushed above its 20-day and 200-day moving averages. Second, it also breached the previous pivot high to signal a potential change in trend. Couple these with the trio of accumulation days that accompanied its mid-August upswing, and you could make the case that the bottom is in.

Let’s go with a bull put spread to bank on the juicier premiums available in HES options. The following bet will payout as Hess shares sit above $62.50 at expiration.

The Trade: Sell the Oct $62.50/$57.50 bull put spread for 50 cents.

A leader in the online sports gambling industry, DraftKings (NASDAQ:DKNG) is expanding its presence across the States and is expected to benefit from the upcoming football season. The company is making well-timed moves to build new offerings and achieve growth. It has successfully partnered with some of the top sports companies to offer a unique experience to the users. DKNG stock is up 22% over the month and is trading close to $60 today.

The stock recorded an all-time high of $74 and the current dip is a great buying opportunity. DraftKings reported strong Q2 numbers and is one of the most valuable companies in the industry with a valuation of $23.9 billion. With that in mind, let’s take a look at my bullish thesis of DKNG stock.

 

The Football Season Is Huge

There is nothing as big as football in the USA and I believe the National Football League (NFL) season will give it a strong boost. The company already has more than 1.1 million monthly unique players and it will be able to attract users during the football fiesta. The company stated that it does not expect any slowdown in the coming months which shows that it is ready to make the most of this season.

DraftKings entered into an agreement with Genius Sports to provide the complete range of official sportsbook data in addition to the complete suite of NFL products. 

In April, the company was chosen as one of the NFL’s tri-exclusive sports betting partners and this is when Genius Sports become the exclusive distributor of the official statistics and sports betting data feed. This makes DKNG one of the first operators that have a full Genius Sports NFL offering including the pre and in-game engagement.

This allows DKNG users to wager on the competitions, thus, enforcing the position of the business as the top provider of live betting products. 

DraftKings recently entered into an agreement with Simplebet, which is a tech company that allows micro-betting. As per the deal, Simplebet will offer its products to the users of DraftKings for NFL, Major League Baseball, and other college football contests. This deal will strengthen the offerings of DKNG and will make it an ideal choice for die-hard sports gamblers. 

Growing National Expansion

DraftKings is constantly expanding its presence across different states and it recently went live in Arizona, making it the 44th state to offer Daily Fantasy Sports. This is the perfect time to launch DraftKings in Arizona as the sports season is set to begin. It will be the most beneficial time for the company to acquire new users and grow its presence.

The company is offering a pre-registration bonus to attract users to the platform. 

DraftKings is heavily invested in expansion and as states legalize online betting, it is not wasting any time in expanding  across the country. 

The only states where betting is prohibited now are Hawaii, Alabama, Louisiana, Idaho, Montana, Iowa, Washington, and Nevada.

 

The Bottom Line On DKNG Stock

I am very bullish on DKNG stock and believe it is for the long term. The company has made some strong partnerships in the industry and is one of the top players today. As the lockdown ends and we resume normalcy, the company will gain from the sports season and it will take DKNG stock higher.

The fundamentals of the company are strong and its user growth is impressive. Cathie Wood bought $60 million worth of DKNG stock recently which has led the stock higher. 

I believe any dip in DKNG stock is a great buying opportunity. The company will report impressive revenue numbers in the coming quarter and it will benefit investors.

On the date of publication, Vandita Jadeja did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.