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Merck (MRK) Gains But Lags Market: What You Should Know

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Merck (MRK - Free Report) closed the most recent trading day at $84.88, moving +1.86% from the previous trading session. This change lagged the S&P 500's 2.02% gain on the day. At the same time, the Dow added 1.6%, and the tech-heavy Nasdaq gained 2.71%.

Heading into today, shares of the pharmaceutical company had gained 2.99% over the past month, outpacing the Medical sector's loss of 2.71% and the S&P 500's loss of 0.39% in that time.

Wall Street will be looking for positivity from MRK as it approaches its next earnings report date. In that report, analysts expect MRK to post earnings of $1.42 per share. This would mark a year-over-year decline of 5.96%. Meanwhile, our latest consensus estimate is calling for revenue of $12.02 billion, down 3.02% from the prior-year quarter.

MRK's full-year Zacks Consensus Estimates are calling for earnings of $5.70 per share and revenue of $47.81 billion. These results would represent year-over-year changes of +9.83% and +2.07%, respectively.

Investors might also notice recent changes to analyst estimates for MRK. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.19% lower. MRK currently has a Zacks Rank of #3 (Hold).

In terms of valuation, MRK is currently trading at a Forward P/E ratio of 14.63. Its industry sports an average Forward P/E of 14.63, so we one might conclude that MRK is trading at a no noticeable deviation comparatively.

Meanwhile, MRK's PEG ratio is currently 2.17. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Large Cap Pharmaceuticals industry currently had an average PEG ratio of 2.02 as of yesterday's close.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 127, which puts it in the top 50% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow MRK in the coming trading sessions, be sure to utilize Zacks.com.


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