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Merck (MRK) Stock Sinks As Market Gains: What You Should Know

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Merck (MRK - Free Report) closed the most recent trading day at $81.20, moving -0.58% from the previous trading session. This change lagged the S&P 500's 0.28% gain on the day. Meanwhile, the Dow gained 0.11%, and the Nasdaq, a tech-heavy index, added 0.14%.

Heading into today, shares of the pharmaceutical company had gained 10.78% over the past month, outpacing the Medical sector's loss of 1.05% and the S&P 500's gain of 0.12% in that time.

Merck will be looking to display strength as it nears its next earnings release, which is expected to be February 3, 2022. On that day, Merck is projected to report earnings of $1.45 per share, which would represent year-over-year growth of 9.85%. Meanwhile, our latest consensus estimate is calling for revenue of $12.62 billion, up 0.84% from the prior-year quarter.

Investors might also notice recent changes to analyst estimates for Merck. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 remained stagnant. Merck currently has a Zacks Rank of #3 (Hold).

Digging into valuation, Merck currently has a Forward P/E ratio of 11.87. This valuation marks a discount compared to its industry's average Forward P/E of 13.03.

Meanwhile, MRK's PEG ratio is currently 1.79. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Large Cap Pharmaceuticals was holding an average PEG ratio of 2.01 at yesterday's closing price.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 211, which puts it in the bottom 18% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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