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Merck (MRK) Gains But Lags Market: What You Should Know

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Merck (MRK) closed the most recent trading day at $76.53, moving +0.18% from the previous trading session. This change lagged the S&P 500's 0.2% gain on the day.

Heading into today, shares of the pharmaceutical company had gained 1.07% over the past month, outpacing the Medical sector's loss of 3.49% and lagging the S&P 500's gain of 3.28% in that time.

Investors will be hoping for strength from MRK as it approaches its next earnings release, which is expected to be July 29, 2021. In that report, analysts expect MRK to post earnings of $1.36 per share. This would mark a year-over-year decline of 0.73%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.21 billion, up 3.15% from the year-ago period.

MRK's full-year Zacks Consensus Estimates are calling for earnings of $5.75 per share and revenue of $46.25 billion. These results would represent year-over-year changes of -3.2% and -3.63%, respectively.

It is also important to note the recent changes to analyst estimates for MRK. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Within the past 30 days, our consensus EPS projection has moved 13.99% lower. MRK is holding a Zacks Rank of #4 (Sell) right now.

In terms of valuation, MRK is currently trading at a Forward P/E ratio of 13.29. This represents a discount compared to its industry's average Forward P/E of 14.7.

It is also worth noting that MRK currently has a PEG ratio of 2.15. 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. MRK's industry had an average PEG ratio of 2.16 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 112, which puts it in the top 45% 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.

To follow MRK in the coming trading sessions, be sure to utilize Zacks.com.


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