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

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Merck (MRK - Free Report) closed the most recent trading day at $89.16, moving +1.28% from the previous trading session. This change outpaced the S&P 500's 0.13% loss on the day. Elsewhere, the Dow lost 0.15%, while the tech-heavy Nasdaq added 0.14%.

Prior to today's trading, shares of the pharmaceutical company had lost 6.98% over the past month. This has lagged the Medical sector's loss of 5.23% and the S&P 500's loss of 3.32% in that time.

Wall Street will be looking for positivity from Merck as it approaches its next earnings report date. This is expected to be July 28, 2022. In that report, analysts expect Merck to post earnings of $1.68 per share. This would mark year-over-year growth of 28.24%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $13.85 billion, up 21.45% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.31 per share and revenue of $58.2 billion. These totals would mark changes of +21.43% and +16.04%, respectively, from last year.

Any recent changes to analyst estimates for Merck should also be noted by investors. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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. Within the past 30 days, our consensus EPS projection has moved 0.11% higher. Merck currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, Merck is holding a Forward P/E ratio of 12.05. This valuation marks a discount compared to its industry's average Forward P/E of 12.63.

We can also see that MRK currently has a PEG ratio of 1.19. 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 2.07 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 155, which puts it in the bottom 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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