AI Stocks Selloff 2026: Overreaction or a Real Warning Sign for Investors?

SPEAKER_1 (0:01)

This is InvestTalk from KPP Financial, helping investors make sense of the markets one day at a time. Here's your host, Luke Guerrero.

Luke Guerrero (0:16)

Good afternoon, fellow investors, and welcome to the Monday, September 21st, to 2026 edition of InvestTalk.

I'm your host, Luke Guerrero, and I'll be with you over this next hour as we dissect the news today, talk a little bit about the market, and most importantly, answer your finance and investment questions. That being said, before we run down the markets performance and preview our show topics, why don't we tackle this caller question now?

Matt (0:48)

Hi, good day, Justin and Luke. Long, long time listener to your great show here, Matt from Minneapolis.

I have a question for you gentlemen about a stock that I'm considering purchasing. Moderna, I've been watching them and their prices going up here and they've been producing some new and good products. And I was wondering if you guys would give this one a thumbs up or not in consideration to adding it to your portfolio. Thank you very much. I'll be listening on the show. Have a good day.

Luke Guerrero (1:20)

Let's take a look at Moderna. Take our MRNA.

Moderna is a pharmaceutical company. It did particularly well coming out of the pandemic because it had one of the COVID vaccines. So it also uses mRNA. It's really an mRNA medicine pioneer. And they have an expanding pipeline that's moving into flu, into combination vaccines, and more recently with its partnership through Merck, these individualized cancer therapies.

Now, more recently, you see momentum technicals being really poor coming out of the pandemic, a steady downward move. And then all of a sudden at the beginning of the year, things start to look up. And a lot of that has really been related to that movement trials with respect to that partnership with Merck. In fact, you saw a huge upward move from about $59 per share, maybe around $63 per share in the middle of August, a huge jump up to $145 and then up another 12.27% today that puts this name up 486.44% year to date, up 585% over the past 52 weeks.

Taking a look at growth, I mean, growth has been pretty solid, but a lot of this has really been overshadowed by this effectively two-year boost in revenue during the pandemic where they had $19 billion in revenue. Now, it's projected to only be about $2 billion this year. It's one of the reasons why those are the only two years of the past five years that profits have actually been positive and in existence. I mean, if you look at their growth year over year in their most recent quarter, it's only 2% growth on revenue. They also had, albeit they had the success so far with the cancer trials, although that's still a long way from production. They had a norovirus vaccine candidate that missed early success. And that was a little boon to the stock as well. With all this being said, guidance did reiterate up to 10% revenue growth for the full year. Their flu vaccine, their MRNA flu vaccine, which is M. Flusiva, got a unanimous positive FDA advisory panel vote ahead of an August decision. And so that was a near-term catalyst coming out of earnings that certainly helped the stock. Overall, though, I think this is an interesting name because a lot of this is going to be predicated on what happens with this cancer vaccine. More recently today, that's what the move was about. They announced three abstracts on its personalized cancer vaccine and put a window for presentation in August on those findings on the Phase 3 data. So this is an interesting case because you don't often see these pharmaceutical companies that did really well for things that exist, and then the pipeline dried up and they have so much on the horizon. So I think with the move we've seen, it's become a bit of a risky play from here. If they are able to succeed in this cancer vaccine, this joint venture with Merck, certainly there is more upside here. But that's still a bit far away. I would expect a bit of a downward move, a little bit more consolidation, and that is when I would be more likely to enter this name. That is Moderna Inc, ticker MRNA. Thanks for the call.

We had a great show for you folks on Friday. I was out, but Justin brought you a story about whether or not you should sell bonds now, and also how to reposition fixed income in a high oil, high rate world. He also answered a listener question on ticker NTRA, which is Netera Inc. If you happen to miss that episode, I encourage you to check it out. And remember, the best way to never miss an episode of InvestTalk is to subscribe wherever you get your podcasts.