Merck & Co., Inc. (NYSE:MRK) Shares Gap Up – Still a Buy?

Merck & Co., Inc. (NYSE:MRK) gapped up before the market opened on Thursday . The stock had previously closed at $86.60, but opened at $88.73. Merck & Co., Inc. shares last traded at $86.76, with a volume of 1,390,633 shares.

Wall Street Analyst Weigh In

MRK has been the topic of a number of research analyst reports. BMO Capital Markets dropped their price objective on shares of Merck & Co., Inc. from $105.00 to $96.00 and set a “market perform” rating on the stock in a report on Wednesday, February 5th. Deutsche Bank Aktiengesellschaft lowered Merck & Co., Inc. from a “buy” rating to a “hold” rating and cut their price target for the company from $128.00 to $105.00 in a report on Tuesday, February 18th. Bank of America reduced their price objective on Merck & Co., Inc. from $118.00 to $112.00 and set a “buy” rating for the company in a research report on Wednesday, February 5th. Guggenheim dropped their target price on Merck & Co., Inc. from $122.00 to $115.00 and set a “buy” rating on the stock in a research report on Wednesday, February 12th. Finally, TD Securities downgraded Merck & Co., Inc. from a “buy” rating to a “hold” rating and lowered their target price for the company from $121.00 to $100.00 in a research report on Monday, February 10th. Eleven equities research analysts have rated the stock with a hold rating, nine have assigned a buy rating and three have issued a strong buy rating to the company’s stock. According to data from MarketBeat, the company currently has an average rating of “Moderate Buy” and an average price target of $117.12.

Merck & Co., Inc. Stock Performance

The company has a debt-to-equity ratio of 0.79, a current ratio of 1.36 and a quick ratio of 1.15. The firm has a market capitalization of $205.83 billion, a PE ratio of 12.11, a P/E/G ratio of 0.77 and a beta of 0.40. The company’s fifty day simple moving average is $90.90 and its 200 day simple moving average is $99.18.

Merck & Co., Inc. (NYSE:MRK) last released its quarterly earnings data on Tuesday, February 4th. The company reported $1.72 EPS for the quarter, missing the consensus estimate of $1.85 by ($0.13). Merck & Co., Inc. had a return on equity of 45.35% and a net margin of 26.67%. The business had revenue of $15.62 billion during the quarter, compared to the consensus estimate of $15.51 billion. During the same period last year, the business posted $0.03 earnings per share. The firm’s quarterly revenue was up 6.8% on a year-over-year basis. As a group, equities research analysts expect that Merck & Co., Inc. will post 9.01 EPS for the current fiscal year.

Merck & Co., Inc. Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Monday, April 7th. Shareholders of record on Monday, March 17th will be paid a $0.81 dividend. The ex-dividend date is Monday, March 17th. This represents a $3.24 dividend on an annualized basis and a yield of 3.98%. Merck & Co., Inc.’s dividend payout ratio is currently 48.14%.

Merck & Co., Inc. announced that its Board of Directors has authorized a share repurchase plan on Tuesday, January 28th that authorizes the company to repurchase $10.00 billion in outstanding shares. This repurchase authorization authorizes the company to repurchase up to 4.1% of its shares through open market purchases. Shares repurchase plans are usually a sign that the company’s board of directors believes its stock is undervalued.

Insider Transactions at Merck & Co., Inc.

In other Merck & Co., Inc. news, Director Inge G. Thulin bought 2,833 shares of the firm’s stock in a transaction that occurred on Thursday, February 6th. The shares were bought at an average price of $88.25 per share, for a total transaction of $250,012.25. Following the transaction, the director now directly owns 2,933 shares in the company, valued at $258,837.25. This trade represents a 2,833.00 % increase in their ownership of the stock. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, insider Cristal N. Downing sold 2,361 shares of the business’s stock in a transaction dated Thursday, February 6th. The shares were sold at an average price of $88.76, for a total value of $209,562.36. Following the completion of the sale, the insider now directly owns 7,085 shares of the company’s stock, valued at approximately $628,864.60. This trade represents a 24.99 % decrease in their position. The disclosure for this sale can be found here. 0.09% of the stock is currently owned by insiders.

Institutional Inflows and Outflows

Hedge funds have recently added to or reduced their stakes in the stock. Vanguard Group Inc. increased its holdings in shares of Merck & Co., Inc. by 0.5% in the fourth quarter. Vanguard Group Inc. now owns 251,096,107 shares of the company’s stock worth $24,979,041,000 after purchasing an additional 1,292,192 shares during the last quarter. Wellington Management Group LLP increased its stake in Merck & Co., Inc. by 6.5% in the 4th quarter. Wellington Management Group LLP now owns 80,742,030 shares of the company’s stock worth $8,032,217,000 after acquiring an additional 4,932,647 shares during the last quarter. Geode Capital Management LLC raised its holdings in shares of Merck & Co., Inc. by 3.4% during the 4th quarter. Geode Capital Management LLC now owns 61,181,863 shares of the company’s stock worth $6,072,582,000 after acquiring an additional 2,026,859 shares in the last quarter. Norges Bank bought a new position in shares of Merck & Co., Inc. during the 4th quarter valued at approximately $3,479,799,000. Finally, Northern Trust Corp grew its holdings in shares of Merck & Co., Inc. by 16.8% in the fourth quarter. Northern Trust Corp now owns 31,377,107 shares of the company’s stock valued at $3,121,395,000 after purchasing an additional 4,511,742 shares in the last quarter. 76.07% of the stock is owned by hedge funds and other institutional investors.

Merck & Co., Inc. Company Profile

Merck & Co, Inc is a health care company, which engages in the provision of health solutions through its prescription medicines, vaccines, biologic therapies, animal health, and consumer care products. It operates through the following segments: Pharmaceutical, Animal Health, and Other. The Pharmaceutical segment includes human health pharmaceutical and vaccine products.