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Here's Why Merck (MRK) is a Strong Momentum Stock

It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors.

Many investors also have a go-to methodology that helps guide their buy and sell decisions. One way to find winning stocks based on your preferred way of investing is to use the Zacks Style Scores, which are indicators that rate stocks based on three widely-followed investing types: value, growth, and momentum.

Is This 1 Momentum Stock a Screaming Buy Right Now?

For momentum investors, upward or downward trends in a stock's price or earnings outlook take precedent, so they'll want to zero in on the Momentum Style Score. This Score can pinpoint good times to build a position in a stock, using factors like one-week price change and the monthly percentage change in earnings estimates.

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Merck (MRK)

Based in Kenilworth, NJ, Merck & Co. boasts more than six blockbuster products in its portfolio with PD-L1 inhibitor, Keytruda, approved for several types of cancer and alone accounting for around 42% of its pharmaceutical sales. Keytruda has played an instrumental role in driving Merck’s steady revenue growth in the past few years. Though Keytruda may be Merck’s biggest strength and a solid reason to own the stock, it can also be argued that Merck is excessively dependent on the drug and should look for ways to diversify its product lineup.

MRK boasts a Momentum Style Score of A and VGM Score of A, and holds a Zacks Rank #3 (Hold) rating. Shares of Merck has seen some interesting price action recently; the stock is down 1.9% over the past one week and up 0.5% over the past four weeks. And in the last one-year period, MRK has gained 9.3%. As for the stock's trading volume, 6,932,243 shares on average were traded over the last 20 days.

A company's earnings performance is important for momentum investors as well. For fiscal 2024, 10 analysts revised their earnings estimate higher in the last 60 days for MRK, while the Zacks Consensus Estimate has increased $0.13 to $8.66 per share. MRK also boasts an average earnings surprise of 38.7%.

With strong earnings growth, a good Zacks Rank, and top-tier Momentum and VGM Style Scores, investors should think about adding MRK to their portfolios.

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Merck & Co., Inc. (MRK) : Free Stock Analysis Report

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Zacks Investment Research