Another day, another stride forward in the race to develop a COVID-19 vaccine.On June 4, Novavax (NVAX) revealed it will receive $60 million from the U.S. Department of Defense (DoD) to further the advancement of its experimental vaccine candidate, NVX-CoV2373, in the U.S., through JPEOCBRND-EB (Joint Program Executive Office for Chemical, Biological, Radiological and Nuclear Defense Enabling Biotechnologies).As per the terms of the agreement, NVAX will work with multiple biologics contract development manufacturing organizations (CDMO) based in the U.S. to increase the scale of antigen and Matrix-M adjuvant production, which are both components of the vaccine. The end goal is to produce 10 million doses for the DoD in 2020, which will then be used in either a Phase 2/3 trial or under an Emergency Use Authorization (EUA).Weighing in on this development for B.Riley FBR, five-star analyst Mayank Mamtani tells investors he’s “encouraged” by the grant, arguing that the U.S. military is a “key population subset of national security importance.”However, Mamtani believes the implications go even further. “We believe this development is in sharp contrast to 3/6 media report speculating NVAX being excluded from the list of five finalists chosen by the Trump administration via Operation Warp Speed (OWS). In fact, this development further strengthens our conviction in a sizeable funding to be secured from U.S. BARDA which has ~$4 billion leftover from the original $6.5 billion allocation under the CARES Act for COVID-19 vaccine development and manufacturing; AstraZeneca/Univ. of Oxford, Moderna, J&J and Merck have been the beneficiaries to date, which might have been potential alternatives considered for this DoD contract,” he explained.While some investors might see the need for U.S.-based CDMO to deliver on this contract as a cause for concern, Mamtani points out that NVAX has already secured capacity. The $388 million grant from the Coalition for Epidemic Preparedness Innovations (CEPI) should be enough to support it through the Phase 2b trial. The non-dilutive funding will instead go towards the Phase 3 NVX-CoV2373 clinical efficacy (outcomes) study and large-scale manufacturing activities. The analyst added, “Here, we think U.S. BARDA could likely commit to secure access for ‘2373 to be expanded in high-risk, frontline workers and/or elderly in an effort to allow for approval of a tried and tested recombinant protein-based vaccine.”With earlier availability of the candidate for stockpiling now likely, the deal is sealed for Mamtani. The analyst rates NVAX a Buy along with a $74 price target. (To watch Mamtani’s track record, click here) In general, other analysts echo Mamtani’s sentiment. 5 Buys and 1 Hold add up to a Strong Buy consensus rating. Given the $50.83 average price target, the upside potential comes in at 13.5%. (See Novavax stock analysis on TipRanks)To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.