Moderna's eye-watering rally has officially outpaced its fundamentals, according to one analyst, prompting a downgrade at a major Wall Street firm.

Citi's Geoff Meacham cut his rating on Moderna shares to Sell from Hold following what he calls an "outsized run" in August. The dizzying stock surge came after Moderna and Merck provided a clinical update for their cancer vaccine candidate, intismeran autogene, sending Moderna sharply higher.

Meacham simultaneously raised his price target on the shares to $80 from $60, though remaining well below current levels. Moderna tumbled 5.3% to $192.57 on Wednesday. Heading into the session, the stock had risen nearly 590% this year against a 12% gain for the benchmark S&P 500 index.

"While intismeran could become a market leading therapy in melanoma, we believe the re-rating now reflects successful expansion in many tumor types and unrealistic implied sales," Meacham wrote on Wednesday.

He added that he struggles to justify Moderna's current valuation whether comparing it to public peers or calculating the net present value of its product pipeline. With a market value near $80 billion, Moderna is valued similarly to Regeneron despite delivering materially lower expected revenue and earnings.

The share move demands more from intismeran, Meacham added. While the latest trial met its main goal, the detailed numbers remain undisclosed. Typical for top-line results, the announcement merely noted that a treatment combining intismeran with Merck's Keytruda was more effective at preventing the recurrence of skin cancer than Keytruda alone.

The next stock catalyst could be the annual meeting of the European Society for Medical Oncology in late October, where Moderna is set to provide more details on its intismeran program. Meacham views a recurrence-free survival hazard ratio of roughly 0.72 as "clinical credible" and 0.65 or lower as "a clear win."

The figure represents the risk of cancer returning in a treatment group compared to a control group over time. Still, Meacham believes the recent stock surge raises the bar, meaning a hazard ratio of 0.72 might qualify for regulatory approval but still leave investors questioning commercial prospects if other clinical metrics are soft.

Currently, the data don't justify Moderna's valuation, as success in melanoma-where intismeran showed promising results-doesn't broadly validate the platform, given that skin cancer is relatively easy to treat. Lung, kidney, and bladder cancers are biologically quite different, meaning success in those trials is far from guaranteed.

Moderna is testing intismeran across nine trials in various solid tumors. In just a few weeks, the drugmaker will present Phase 3 data evaluating intismeran in combination with immunotherapy for early-stage non-small cell lung cancer.

However, Meacham cautioned that regulatory approval-which optimistic estimates suggest is still months away-will be the easy part. To justify Moderna's steep valuation, late-stage trials must show a clinical benefit large enough to offset the high cost of manufacturing bespoke vaccines for a broader population.

The downgrade makes Citi one of the most bearish voices on Wall Street, where analysts are largely sidelined on the shares. Of the 19 firms tracked by FactSet, six rate Moderna stock a Buy, 11 rate it a Hold, and only two-Citi excluded-carry a Sell rating or the equivalent.