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Merck (MRK) Stock Slides as Market Rises: Facts to Know Before You Trade

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The most recent trading session ended with Merck (MRK - Free Report) standing at $130.20, reflecting a -1.24% shift from the previouse trading day's closing. The stock trailed the S&P 500, which registered a daily gain of 0.85%. Meanwhile, the Dow experienced a drop of 0.09%, and the technology-dominated Nasdaq saw an increase of 1.53%.

Heading into today, shares of the pharmaceutical company had gained 2.47% over the past month, outpacing the Medical sector's gain of 2.46% and lagging the S&P 500's gain of 3.11% in that time.

Market participants will be closely following the financial results of Merck in its upcoming release. The company plans to announce its earnings on July 30, 2024. It is anticipated that the company will report an EPS of $2.14, marking a 203.88% rise compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $15.88 billion, up 5.65% from the prior-year quarter.

MRK's full-year Zacks Consensus Estimates are calling for earnings of $8.62 per share and revenue of $64.4 billion. These results would represent year-over-year changes of +470.86% and +7.13%, respectively.

It is also important to note the recent changes to analyst estimates for Merck. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

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, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.67% lower. Currently, Merck is carrying a Zacks Rank of #3 (Hold).

Looking at valuation, Merck is presently trading at a Forward P/E ratio of 15.29. This expresses a premium compared to the average Forward P/E of 14.38 of its industry.

It's also important to note that MRK currently trades at a PEG ratio of 2.55. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. MRK's industry had an average PEG ratio of 1.76 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 149, which puts it in the bottom 41% 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.

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

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