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Merck (MRK) Increases Despite Market Slip: Here's What You Need to Know

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Merck (MRK - Free Report) closed the most recent trading day at $132.96, moving +1.71% from the previous trading session. The stock outperformed the S&P 500, which registered a daily loss of 0.31%. On the other hand, the Dow registered a gain of 0.67%, and the technology-centric Nasdaq decreased by 1.09%.

The the stock of pharmaceutical company has risen by 0.95% in the past month, leading the Medical sector's gain of 0.61% and undershooting the S&P 500's gain of 2.73%.

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. The company is predicted to post an EPS of $2.14, indicating a 203.88% growth compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $15.88 billion, up 5.65% from the year-ago period.

For the full year, the Zacks Consensus Estimates are projecting earnings of $8.61 per share and revenue of $64.4 billion, which would represent changes of +470.2% and +7.13%, respectively, from the prior year.

Investors should also take note of any recent adjustments 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.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional 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. Over the past month, there's been a 0.73% fall in the Zacks Consensus EPS estimate. Merck is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note Merck's current valuation metrics, including its Forward P/E ratio of 15.18. For comparison, its industry has an average Forward P/E of 14.53, which means Merck is trading at a premium to the group.

It's also important to note that MRK currently trades at a PEG ratio of 2.53. 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. Large Cap Pharmaceuticals stocks are, on average, holding a PEG ratio of 1.79 based on yesterday's closing prices.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This industry currently has a Zacks Industry Rank of 156, 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.

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


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