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

Merck (MRK) closed at $83.03 in the latest trading session, marking a -1.18% move from the prior day. This change lagged the S&P 500's daily gain of 0.55%. At the same time, the Dow added 0.18%, and the tech-heavy Nasdaq gained 1.03%.

Coming into today, shares of the pharmaceutical company had gained 1.24% in the past month. In that same time, the Medical sector gained 2.05%, while the S&P 500 gained 3.13%.

MRK will be looking to display strength as it nears its next earnings release. On that day, MRK is projected to report earnings of $1.35 per share, which would represent year-over-year growth of 16.38%. Meanwhile, our latest consensus estimate is calling for revenue of $12.59 billion, up 6.06% from the prior-year quarter.

Any recent changes to analyst estimates for MRK should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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 0.02% higher. MRK currently has a Zacks Rank of #2 (Buy).

In terms of valuation, MRK is currently trading at a Forward P/E ratio of 13.84. This represents a discount compared to its industry's average Forward P/E of 14.09.

Investors should also note that MRK has a PEG ratio of 1.93 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Large Cap Pharmaceuticals was holding an average PEG ratio of 2.05 at yesterday's closing price.

The Large Cap Pharmaceuticals industry is part of the Medical sector. This group has a Zacks Industry Rank of 96, putting it in the top 38% 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.

To follow MRK in the coming trading sessions, be sure to utilize Zacks.com.


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