Merck (MRK) Gains As Market Dips: What You Should Know

In the latest trading session, Merck (MRK) closed at $92.51, marking a +0.67% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.07%. Elsewhere, the Dow gained 0.27%, while the tech-heavy Nasdaq added 0.02%.

Prior to today's trading, shares of the pharmaceutical company had lost 0.15% over the past month. This has was narrower than the Medical sector's loss of 5.47% and the S&P 500's loss of 7.99% in that time.

Investors will be hoping for strength from Merck as it approaches its next earnings release, which is expected to be July 28, 2022. On that day, Merck is projected to report earnings of $1.68 per share, which would represent year-over-year growth of 28.24%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $13.85 billion, up 21.45% from the year-ago period.

MRK's full-year Zacks Consensus Estimates are calling for earnings of $7.32 per share and revenue of $58.2 billion. These results would represent year-over-year changes of +21.59% and +16.04%, respectively.

Investors should also note any 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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 0.07% higher. Merck is holding a Zacks Rank of #2 (Buy) right now.

Looking at its valuation, Merck is holding a Forward P/E ratio of 12.56. Its industry sports an average Forward P/E of 13.17, so we one might conclude that Merck is trading at a discount comparatively.

Investors should also note that MRK has a PEG ratio of 1.24 right now. 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 2.04 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 104, which puts it in the top 42% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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