Analyst Daina Graybosch from Leerink Partners reiterated a Buy rating on Merck & Company (MRK – Research Report) and decreased the price target to $113.00 from $118.00.
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Daina Graybosch’s rating is based on a combination of factors, including the belief that the recent 9% sell-off of Merck’s stock was an overreaction to investor concerns about Gardasil’s performance in China. Graybosch believes that Merck’s management could have mitigated the downturn by setting lower expectations rather than expressing confidence in a demand recovery. Despite the challenges with Gardasil, the analyst views the broader pipeline of Merck as a potential upside, though investor confidence in management may take time to rebuild.
Graybosch is optimistic about several other catalysts for Merck, such as positive outcomes from the Phase 3 ZENITH trial for Winrevair and the potential approval and launch of clesrovimab. Additionally, the analyst updated the financial model to reflect Merck’s recent guidance, estimating slightly higher revenues and EPS than the company’s guidance. With these considerations, the price target was adjusted to $113, and the Buy rating was reiterated.
Graybosch covers the Healthcare sector, focusing on stocks such as Merck & Company, BioNTech SE, and Affimed. According to TipRanks, Graybosch has an average return of -15.5% and a 30.86% success rate on recommended stocks.
In another report released yesterday, J.P. Morgan also maintained a Buy rating on the stock with a $130.00 price target.