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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 $77.83, moving +0.88% from the previous trading session. This move outpaced the S&P 500's daily loss of 0.79%. At the same time, the Dow lost 0.53%, and the tech-heavy Nasdaq lost 0.48%.

Heading into today, shares of the pharmaceutical company had lost 2.35% over the past month, lagging the Medical sector's loss of 0.76% and outpacing the S&P 500's loss of 2.43% 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 April 28, 2022. The company is expected to report EPS of $1.86, up 32.86% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $14.73 billion, up 21.91% from the year-ago period.

MRK's full-year Zacks Consensus Estimates are calling for earnings of $7.28 per share and revenue of $57.09 billion. These results would represent year-over-year changes of +20.93% and +13.83%, respectively.

Investors should also note any recent changes to analyst estimates for Merck. Recent revisions tend to reflect the latest 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 3.73% higher within the past month. Merck is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Merck has a Forward P/E ratio of 10.6 right now. This valuation marks a discount compared to its industry's average Forward P/E of 12.3.

Meanwhile, MRK's PEG ratio is currently 1.23. 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 group has a Zacks Industry Rank of 94, putting it in the top 38% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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