Merck (MRK - Free Report) closed at $75.48 in the latest trading session, marking a +0.53% move from the prior day. This change outpaced the S&P 500's 0.25% loss on the day. Meanwhile, the Dow gained 0.04%, and the Nasdaq, a tech-heavy index, lost 0.53%.
Coming into today, shares of the pharmaceutical company had gained 6.57% in the past month. In that same time, the Medical sector lost 1.06%, while the S&P 500 lost 2.35%.
Investors will be hoping for strength from MRK as it approaches its next earnings release, which is expected to be February 1, 2019. In that report, analysts expect MRK to post earnings of $1.04 per share. This would mark year-over-year growth of 6.12%. Meanwhile, our latest consensus estimate is calling for revenue of $11.05 billion, up 5.91% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.34 per share and revenue of $42.29 billion. These totals would mark changes of +9.05% and +5.41%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for MRK. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.4% higher. MRK currently has a Zacks Rank of #2 (Buy).
Digging into valuation, MRK currently has a Forward P/E ratio of 17.32. This valuation marks a premium compared to its industry's average Forward P/E of 14.74.
Also, we should mention that MRK has a PEG ratio of 2.04. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. MRK's industry had an average PEG ratio of 2.01 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 75, which puts it in the top 29% 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.
To follow MRK in the coming trading sessions, be sure to utilize Zacks.com.