Opinions Stockchase Insights
Merck & CompanyMRKBUY ON WEAKNESSJul 08, 2024
Stockchase InsightsStock price when the opinion was issued
As of Jun 09, 2026. Market Open.
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Today's downward move isn't all that outsized. There's been more clarity on US drug pricing. Seeing a bit of market exhaustion, as US pharma is trading at huge premiums relative to their own history.
Rerating from pricing clarity has already been baked in. R&D pipeline in the sector is a mixed bag, doesn't trust it.
He bought it for their strong drug pipeline and is happy to stay here.
Gordon ReidOne of her holdings in the space. This higher-quality name has both growth and less execution risk.
Brianne Gardner
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Pharmas are coming back. Political policy is improving. Keytruda makes up a lot of revenues but faces a patent cliff in 2028. But MRK has invested a lot in new drugs and been buying companies strategically.
(Analysts’ price target is $123.89)
Julien Nono-WomdimPremium content
They have a good pipeline that will help offset the loss of their major Keytruda drug when it goes off-patent. MRK is good at buying and tucking in companies. Their 2025 chart wasn't that great until the end of the year when the sector caught a bid.
Gordon Reid
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The pharma sector is always in the political crosshairs. Both candidates have vowed reforms, but in different approaches. But both like to attack drug prices, both in amount and how they are paid (third party insurance, medicare, etc.). In other elections, though, the 'talk' is often worse than what actually happens. Both candidates know the sector is important for US growth, and the population is getting older. MRK and others can best compete with their drug pipeline, so that they can grow even with restrictions on revenue/prices. For MRK in specifically, consensus calls for very strong EPS growth in each of the next two years. If MRK can meet expectations, we think it can overcome any political fallout. It is also quite cheap at 14X earnings so some uncertainty is embedded in prices already.
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