Opinions Greg Newman
Merck & CompanyMRKDON'T BUYSep 25, 2025
Greg NewmanStock price when the opinion was issued
As of Jul 31, 2026. Market Open.
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Keytruda makes up half of sales, which makes the market nervous, because the drug faces a patent cliff in a few years. Their pipeline is deep, and the acquisitions they made will replenish that pipeline. Even when it goes off-patent, Keytruda will remain a preferred drug by doctors.
Julien Nono-WomdimPremium contentWe reiterate MRK as a TOP PICK. Sales of its top cancer treatment drug, which accounts for the marjority of its revenues, is expected to more than triple its current $8 billion sales by 2028 and it has a long pipeline of new drugs, with plans to release over 20 by 2030. It trades at 23x earnings and supports a ROE of 27%. Cash reserves are growing, while shares are bought back, albeit with an increase in debt. We continue to recommend a stop at $110, looking to achieve $143 -- upside potential of 18%. Yield 2.7%
(Analysts’ price target is $131.56)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 GardnerPremium contentPharmas 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
Culprit for stock pain is Keytruda, coming off patent, and providing 40% of revenues. Slashing costs. Pretty darn cheap down here at 8x for 2027. But no growth rate after Keytruda. Better places in pharma to park capital.