This Pharma Stock Had a Rough Year. Why One Analyst Thinks It Can Rise 250%.

Vaxcyte’s shot could be a game changer in the $8 billion pneumococcal vaccine market, an analyst argued. (Dreamstime)

Key Points

• Mizuho Securities reiterates an Outperform rating and a $163 price target for Vaxcyte, projecting a 250% jump from current levels.
• Vaxcyte’s experimental vaccine, VAX-31, is advancing to phase 3 trials in adults and phase 2 trials in infants, targeting an $8 billion market.
• Vaxcyte anticipates key trial readouts in 2026 and 2027 for its pneumococcal disease vaccine.

Biotechnology company Vaxcyte hasn’t yet justified investors hopes around its experimental pneumococcal disease vaccine. That could start to change in 2026, according to analysts at Mizuho Securities.

Vaxcyte stock kept its place as one of Mizuho’s top picks entering 2026, with the firm reiterating an Outperform rating and a $163 price target in a research note. Vaxcyte is advancing to phase 3 trials for its shot, VAX-31, in adults and phase 2 trials for infants. It could eventually be a leader in an $8 billion market, Mizuho argued.

The California-based biotech had a brutal 2025. Imperfect trial results for its a pneumococcal conjugate vaccine, VAX-24, in infants sent the stock spiraling by 46% on March 31 alone. Shares have yet to recover, closing Friday down 43% this year at $46.42.

In premarket trading Monday, the stock gained 4.4% to $48.48.

Mizuho’s target implies a 250% jump from Friday’s close and the stock has some key catalysts ahead. Vaxcyte is expected to initiate all adult VAX-31 phase 3 studies in 2026 and deliver a readout on the first of those trials by the end of the year. The company also should have results from infant phase 2 trials in the first half of 2027.

Calling the vaccine “broadly de-risked,” Mizuho said it believes those results carry little downside for investors but plenty of potential gains.

“This positive data from VAX-31 in adults is the broadest serotype
coverage data we have seen from a [pneumococcal conjugate vaccine] and has the potential to be best-in-class,” wrote analyst Salim Syed.

The market for pneumococcal disease vaccines is $8 billion and growing. Pharma giants Pfizer , with its Prevnar 20 shot, and Merck are major players in the space, but Vaxcyte presents a long-term threat to them.

Mizuho has maintained a $163 price target for Vaxcyte stock since September 2024, shortly after the company said the immune response from VAX-31 was as good or better than the response elicited by Prevnar 20 across all strains of the streptococcus bacteria.

The firm hasn’t been rewarded for that bullish call since then, but it isn’t alone entering 2026. Of the 10 analysts polled by FactSet, nine have Buy or equivalent ratings on Vaxcyte stock.

Write to Nate Wolf at nate.wolf@barrons.com