Merck (MRK) Stock Sinks As Market Gains: What You Should Know
Merck (MRK) closed the most recent trading day at $78.12, moving -0.66% from the previous trading session. This change lagged the S&P 500's 2.24% gain on the day. Meanwhile, the Dow gained 1.55%, and the Nasdaq, a tech-heavy index, added 0.5%.
Prior to today's trading, shares of the pharmaceutical company had gained 1.07% over the past month. This has outpaced the Medical sector's loss of 1.51% and the S&P 500's loss of 4.46% in that time.
Investors will be hoping for strength from Merck as it approaches its next earnings release, which is expected to be April 28, 2022. The company is expected to report EPS of $1.87, up 33.57% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $14.73 billion, up 21.91% from the year-ago period.
MRK's full-year Zacks Consensus Estimates are calling for earnings of $7.23 per share and revenue of $57.09 billion. These results would represent year-over-year changes of +20.1% and +13.83%, 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. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.05% lower 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 10.88 right now. This valuation marks a discount compared to its industry's average Forward P/E of 12.54.
Meanwhile, MRK's PEG ratio is currently 1.27. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Large Cap Pharmaceuticals industry currently 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 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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