The surge on Wall Street, the losses of the short-sellers and the chance to prevent cancer: where are Moderna shares heading

“I guess a lot of people on Wall Street were fired today, walked out of the building and won't be coming back,” said investor Martin Shkreli, nicknamed “Pharma Bro,” over the weekend, referring to the massive “short squeeze” that occurred in the shares of the vaccine and pharmaceutical company Moderna last week. It is estimated that as a result, short-sellers in the stock lost about $5.5 billion. In a YouTube video where he analyzed the move, Shkreli admitted that he himself lost quite a bit when he bet against the possibility that Moderna would rise above $80 per share.

A short squeeze is a process of a sharp price increase that occurs in a stock where there is a large volume of short sellers. While the short sellers' expectation is that the stock price will fall, so they can “cover” back the shares they sold at a price lower than the selling price, the sharp rise in the stock causes them losses, as they are forced to buy and thus contribute to further increases.

At the center of the event is Moderna’s report of success in a trial for a skin cancer vaccine of the melanoma type.

As a result, Moderna shares rose last Wednesday by almost 3 times - from $62 at the beginning of the trading day to $165 at the end, and at the end of trading on Friday, after partial profit-taking, stabilized at a price of $145. This is a cumulative increase of 472% over the past year. However, the stock price is still about 70% lower than the peak price recorded during the COVID days, when Moderna was one of the only companies to develop a vaccine for the global pandemic. Now, the company’s value stands at about $58 billion - an addition of $30 billion since the report.

Before the surge in the stock, the short interest in Moderna stood at about 14% of the share capital (compared to an average of about 4.2% for S&P 500 stocks). Some hedge funds sold their strongest stocks to cover the losses from the short, causing fluctuations in the technology stock market.

What exactly did Moderna report?

Moderna’s new product is called a vaccine because it works through the immune system, but unlike a classic vaccine, it is not intended to protect the entire population from a disease they have not yet contracted.

The treatment is intended for people who have already had melanoma skin cancer, in which mapping of the patient’s specific tumor is performed, and an mRNA sequence is produced that learns which mutations are present only on his tumor, and not on healthy tissues. The mRNA technology trains the immune system to attack the cells containing these mutations.

In the current trial (Phase III), Moderna’s solution was combined with the drug “Keytruda” from the company Merck, which works by removing barriers from the immune system and increasing its activity. The combined product was given to melanoma patients who had recovered from cancer, but the risk of recurrence was assessed as high.

Why was the market surprised?

Moderna and Merck’s Phase III trial included 1000 patients and was stopped early after an independent advisory committee felt that the chance of failure was very low. The trial results were originally expected only in 2029, so the market did not even price in a chance for such a dramatic result for Moderna in August 2026.

When the trial succeeded, and the stock rose so significantly, the market got the impression that an “event” had occurred in the field of cancer treatment, and this spurred the rush for the stock. “Cancer vaccine” sounds like a higher achievement than the actual meaning of the trial.

However, these are definitely positive results. The combination of the two drugs did indeed significantly outperform the use of Keytruda alone. So far, no cases have been found where the combination so clearly outperformed Keytruda alone.

The companies did not publish the full results, but in a smaller trial they conducted with the same product, the results of which were published last June, the combined drug reduced the risk of disease recurrence by 49%.

Why did the stock fall in the past?

Since the peak in Moderna’s stock in 2022 and until the beginning of 2026, it lost about 95% of its value. Shkreli explained in his video that “everyone assumed this company was dead. All it had left were the fluttering fumes of the COVID business.”

But those who followed the stock in recent months noticed that it had already risen by 150% since the beginning of 2026. After a struggle with the FDA, the company received approval for its flu vaccine, which is currently a much larger and more stable market than the COVID vaccine.

Is there still room for the stock to rise?

Estimates now are that the product in question for cancer could be on the market in 2027. According to Ori Hershkovitz, a pharma analyst and manager of the Bennu Pharma hedge fund, the specific market that the current indication is aimed at could generate $3-4 billion a year, which will be divided between Moderna and Merck. On Friday, Hershkovitz estimated this addition to Moderna’s value at about $9 billion, meaning significantly less than the actual increase in value.

But it is unclear whether the profitability of the product will be as high as is customary in the pharma market, due to the difficulty of producing it for each patient separately.

However, the optimistic version of the story sees this as just the beginning of the road, as it is possible to develop drugs for many types of cancer using mRNA technology, in which Moderna is one of the two market leaders (alongside BioNTech).