Investors have had a rough go of it this year, as Novavax’s (NVAX -2.47%) price has dropped by 60% so far in 2022. After a number of stumbles that culminated in its catastrophic earnings report on August 8, its shares have fallen by 60% thus far in the year. And with management cutting its full-year revenue target by about half, there is not much optimism for at least a few quarters.

For contrarian investors, that means the stock may be ready for a buy with the intention of hanging on through a recovery. Most of us, on the other hand, are not contrarians, so now might be the time to cut and run or at least put off purchasing until things improve.

Finally, here’s one reason to sell your shares and one reason for buying more.

Nuvaxovid sales have been worse than expected

The most significant reason to consider selling your Novavax stock is that its quarter 2 earnings were so far off the target that the firm issued a special separate news release to make a statement regarding its anticipated future performance in order to appease investors.

The biotech earned $186 million in revenue during the second quarter, a significant drop from the $298 million it generated in the prior-year period. According to the company’s claims, only $55 million of its income was derived from sales of its Covid-19 vaccine, Nuvaxovid, and it sold just 3 million doses—far short of the 2 billion doses it said it had manufacturing capacity for at the beginning of the year.

The issue is already on the mend, with nearly 23 million doses distributed since July. But the rest of the year appears to be a failure in any case. Management reaffirmed its 2022 sales target of between $4 billion and $5 billion for its shot in May, despite the fact that it had previously projected a margin of below 15% for the year.

Given that the revenue outlook for 2023 is expected to be lower than the previous estimate for 2022, it will certainly be entering next year against a declining demand in the vaccine market. And all of this adds up to make its stock tough to justify holding or purchasing.

Its vaccine just might have an edge

One possible explanation for why Novavax might be a good investment for the right sort of investor is that it may give significant protection against covid-19, even against some of the more immunologically evasive viral variants in omicron lineages, based on certain clinical and pre-clinical findings made in late June.

In addition, the protection appears to be long-lasting and perhaps even increases over time as a booster dose is received. However, these findings must be further validated through real-world trial data.

Novavax is working on vaccine variants that may be more effective at preventing Covid-19 infection than the current version it offers. So by the end of next year, it might have a superior product than rivals like Moderna or Pfizer, and revenue growth will continue throughout 2023 as a result. Greater vaccine efficacy could be a catalyst for investors to move ahead.

This is a stock that has suddenly become much more attractive, based on current valuations. The market may be overreacting to the bad news from the quarter 2 results. While I would not expect an immediate rally, the stock could be an appealing choice for contrarians prepared to take somewhat long odds on vaccine effectiveness determining future demand.

The cryptocurrency market has been particularly volatile in the last year, with prices rising to all-time highs and plummeting to all-time lows. With the stock market on shaky ground and a recession potentially on its way, it doesn’t appear that this volatility will abate any time soon.

Despite the ups and downs, now may be a good time to get involved in cryptocurrency. If you’ve been hesitant about investing, there are two compelling reasons to consider buying right now, as well as one reason to avoid cryptocurrencies entirely.

Why you may want to invest right now

When the market is in a slump and cryptocurrency values are plummeting, it may appear to be the worst time to invest. downturns, on the other hand, might be one of the most cost-effective times to invest.

Cryptocurrencies are expensive to invest in. Bitcoin’s (BTC 3.72%) highest price was around $70,000 per token, whereas Ethereum’s (ETH 8.64%) peak was slightly lower at $4,800 per token. Currently, they are selling for $24,000 and $1,700 per token, respectively.

If you’ve ever considered investing in cryptocurrency, now might be the moment to do it. The price of cryptocurrencies has decreased significantly from their all-time highs, and if they reach those levels again, you may make a lot of money by investing right now.

The ups and downs of cryptocurrency are exceptionally volatile, and downturns can be difficult to accept. However, the long-term performance of an investment is more significant than its short-term gains and losses.

Those who have kept their investments for the long run have historically received outstanding returns. Despite its price plummeting by more than 50% since the start of the year, Bitcoin is up approximately 576% over the past five years.

Nobody can predict whether cryptocurrencies will ultimately flourish. But if crypto does succeed, you may see significant gains by investing immediately and keeping your assets for the long term.

When it’s better to steer clear

Cryptocurrencies might be an extremely lucrative investment for some people, but it isn’t right for everyone. Because the sector is still very speculative today, it may be quite hazardous; and there’s always the chance you’ll lose all of your money.

It might be difficult to take such a chance, especially if your funds are limited. If you have just a little cash to invest, it may be prudent to concentrate on equities, indexed investments, ETFs, or other “safer” assets before making your crypto purchase.

Even if you can manage it, not everyone wants to undertake a high-risk investment; it’s fine. Everyone has their own investing style. It may not be the greatest fit for your portfolio if you’d be sleepless over the ups and downs all of the time.

While crypto is a high-risk/high-reward investment, patience might pay off in the long run. While it isn’t suitable for everyone, if you’re prepared to take on greater risk for potentially lucrative profits right now may be a great time to invest.

Don’t look now, but after a tough first half of this year, cryptos are quietly staging a rapid and furious comeback from their lows over the previous month and a half—just as many analysts appeared to be writing them off. If you are a new crypto investor eager to get your feet wet in the digital pond after this resurgence in optimism, I’d suggest buying Ethereum (ETH -4.73%).

Momentum returns 

Ethereum has risen nearly 97 percent since bottoming at $897 on June 18, owing to the significant market swings that have taken place as a result of investor sentiment.If you’re thinking about whether it’s too late to invest in Ethereum, keep in mind that it’s still down 63% from its all-time high of $4,847, which it achieved last November. Furthermore, if widespread adoption occurs for Ethereum, everyone will probably be “early,” according to experts. Given how volatile cryptocurrencies are on a daily basis, an investor interested in putting money into Ethereum but concerned about jumping in during a run-up may profit from dollar-cost averaging, which has long been used by equity investors to start a smaller position now and then add to it over time rather than investing everything at once.

Coming up on The Merge 

The major reason for Ethereum’s recent jump is the pending shift to proof of stake. This transformation, often known as The Merge, is the biggest change to the Ethereum network and its users in years, if not ever. Switching to a proof-of-stake consensus should help solve two of Ethereum’s long-standing problems – high transaction costs and slow transaction speeds. Furthermore, because of this change, more individuals will be able to participate in the ETH network and earn rewards by staking their ether. This essentially means that users will be able to contribute to the security of the network by committing a portion of their Ethereum to validate the transactions in exchange for a share of staking profits. Finally, the transition can assist Ethereum in becoming more environmentally friendly by decreasing its carbon footprint, which has been a common complaint leveled at proof-of-work cryptos over the years.

The foundation of DeFi

Ethereum has a market cap of $208 billion, which vastly eclipses all other cryptocurrencies except for Bitcoin. It was originally released in 2015, long before most of today’s other prominent cryptocurrencies were even conceived. Ethereum is, therefore, the system that underpins much of the current decentralized finance (DeFi) ecosystem. Many other well-known cryptos are ERC-20 tokens based on Ethereum, including Uniswap, USD Coin, and Shiba Inu. Polygon was made as a scaling solution for the Ethereum environment. After a tremendous run this summer, Polygon is now ranked 13th in terms of market capitalization.

Additionally, the significance of Ethereum to DeFi and bitcoin as a whole is underlined by the fact that many other top cryptocurrencies rely on the Ethereum Virtual Machine, which is essentially a middleware layer that enables smart contracts from Ethereum to execute on other blockchains.

The S&P 500 has been flirting with bear market territory for the last several weeks, causing investors to suffer. Although the market has resumed its upward climb from its June lows, numerous stocks are still trading at considerable losses below their 12-month highs.

Despite the fact that many businesses have reached bargain levels, due to its drop, a lot of firms are currently trading at reduced prices. Two consumer-related equities may be especially appealing right now: Booking Holdings (BKNG -0.44%) and Qualcomm (QCOM -3.55%). Let’s take a deeper look.

Booking Holdings

Priceline.com is a multinational corporation that owns numerous travel-related web properties, including Priceline, KAYAK, Agoda, and current namesake Booking.com. The bear market has reduced the company’s stock price to less than $2,000 per share, down nearly 30% from its peak.

Despite this declining stock price, the firm’s financials are becoming increasingly healthy. The company’s revenue for the first two quarters of 2022 was roughly $7 billion, which is greater than the $6.7 billion it reported in the first half of 2019 before the pandemic.

Its $157 million net profit for the first six months of this year is a tiny fraction of the $1.7 billion made in 2019. Over the three-year stretch, operating costs increased by 19%, and losses on its assets in a number of equity securities cut earnings by more than $700 million.

Booking didn’t give specific revenue expectations, but it did say on its Q2 2022 earnings call that it expects to report “record” revenue in the third quarter. Even so, if travel sales continue at the same pace as they have been, Booking will have a forward P/E of 20 – which might make it a bargain if growth exceeds 2019 levels.

Qualcomm

Qualcomm is typically seen as a technology stock, owing to its technological preeminence in smartphone microprocessors. Nonetheless, it still relies largely on the consumer for revenue, which adds further pressure on the company’s earnings.

Qualcomm’s own expectations appear to have been influenced by consumer trends. For the next fiscal fourth quarter of 2022, Qualcomm predicted revenue of $11 billion to $11.8 billion, representing year-over-year growth of 23%. That would compare to fiscal Q3, when handset sales grew 59% year over year.

However, a 23 percent increase in sales indicates that this market is resilient. Grand View Research expects the 5G chipset market to grow at a compound annual rate (CAGR) of 69% throughout 2025. Given this prediction, it appears likely that the anticipated slowing will not continue as the 5G upgrade cycle continues.

The company’s expected development may explain the stock’s relative stability over the past year, despite a 6% decline in the S&P 500’s total return. A P/E of 13 indicates that the market does not appear to fully recognize this potential. Investors should consider purchasing Qualcomm at these prices.

Starbucks (SBUX) has taken a beating lately. The firm’s performance over the past year is 27%, far worse than the Dow Jones Industrial Average’s 6% drop.

Starbucks’ share price guzzling has been kept in check, however, by supply chain shortages, a growing recession, and inflation. On the other hand, they weren’t the highlights of the company’s financial third-quarter results, which were announced on August 2.

Let’s look at the highlights and the primary issue that weighed on Starbucks’ excellent performance

1 green flag: Starbucks is becoming a worldwide brand

Starbucks is a firm that continues to grow in popularity throughout the world. The company’s main strength is its size in China and the United States, which has remained consistent since Q3. Revenue from these two countries accounted for 75% of total revenue during the quarter. Starbucks, on the other hand, saw considerable success with its  business operations outside these two countries.

Starbucks reported record revenue and earnings for the third quarter of 2017, fueled by new store openings in Canada, China, Mexico and the United States. International comparable-store sales increased in the double digits, with international markets (excluding China) recording sales growth. In Japan – Starbucks’ third-largest market – comparable sales accelerated to their fastest rate since the year began.

Global expansion, as demonstrated by this quarter’s earnings, is paying off. Starbucks’ global brand continues to strengthen; not only does the firm have operations in China and the United States, but it may also be regarded as the world’s first coffee business to have a globally recognized brand because of its presence across the world.

1 red flag: The China knife cuts both ways

Despite a very good quarter for Starbucks, one area tanked: China. In contrast to many American companies, Starbucks has succeeded in China. Starbucks currently has over 5,700 outlets in China and last year generated almost $3.7 billion in revenue from the region.

However, the COVID-19 security restrictions have taken their toll on Starbucks. In Q3, comparable store sales in China fell 44%, dragging total worldwide comparable store sales down 18% versus the prior year despite good execution in virtually all areas.

The bottom line is that doing business in China is a risk. In recent years, Starbucks has benefited from the prosperous Chinese economy and rising consumer demand. That said, the economic climate is difficult to predict, which means businesses working in China might experience significant swings in fortune. Q3 was a reminder of this fact.