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

Merck & Co., Inc. (NYSE:MRK) gapped up prior to trading 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.

Analysts Set New Price Targets

MRK has been the subject of a number of research analyst reports. Guggenheim decreased their price target on Merck & Co., Inc. from $122.00 to $115.00 and set a “buy” rating for the company in a research report on Wednesday, February 12th. Leerink Partners lowered their target price on shares of Merck & Co., Inc. from $136.00 to $119.00 and set an “outperform” rating on the stock in a report on Monday, January 13th. TD Securities lowered shares of Merck & Co., Inc. from a “buy” rating to a “hold” rating and cut their price objective for the company from $121.00 to $100.00 in a research report on Monday, February 10th. Bank of America decreased their target price on Merck & Co., Inc. from $118.00 to $112.00 and set a “buy” rating on the stock in a research note on Wednesday, February 5th. Finally, Morgan Stanley reduced their price target on shares of Merck & Co., Inc. from $113.00 to $106.00 and set an “equal weight” rating on the stock in a research report on Wednesday, February 5th. Eleven research analysts have rated the stock with a hold rating, nine have given a buy rating and three have assigned a strong buy rating to the company’s stock. Based on data from MarketBeat, Merck & Co., Inc. has an average rating of “Moderate Buy” and an average price target of $117.12.

Merck & Co., Inc. Stock Performance

The company has a current ratio of 1.36, a quick ratio of 1.15 and a debt-to-equity ratio of 0.79. The stock’s 50 day moving average price is $90.90 and its two-hundred day moving average price is $99.18. The firm has a market capitalization of $205.83 billion, a PE ratio of 12.11, a PEG ratio of 0.77 and a beta of 0.40.

Merck & Co., Inc. (NYSE:MRK) last issued its earnings results on Tuesday, February 4th. The company reported $1.72 earnings per share 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 firm had revenue of $15.62 billion during the quarter, compared to analysts’ expectations of $15.51 billion. During the same period last year, the business posted $0.03 earnings per share. The company’s quarterly revenue was up 6.8% compared to the same quarter last year. On average, equities analysts expect that Merck & Co., Inc. will post 9.01 earnings per share for the current year.

Merck & Co., Inc. Dividend Announcement

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

Merck & Co., Inc. declared that its board has initiated a share buyback plan on Tuesday, January 28th that authorizes the company to buyback $10.00 billion in shares. This buyback authorization authorizes the company to reacquire up to 4.1% of its stock through open market purchases. Stock buyback plans are often a sign that the company’s board of directors believes its stock is undervalued.

Insider Activity at Merck & Co., Inc.

In other news, Director Inge G. Thulin purchased 2,833 shares of Merck & Co., Inc. stock in a transaction that occurred on Thursday, February 6th. The stock was acquired at an average price of $88.25 per share, for a total transaction of $250,012.25. Following the transaction, the director now owns 2,933 shares in the company, valued at $258,837.25. The trade was a 2,833.00 % increase in their ownership of the stock. The purchase was disclosed in a legal filing with the SEC, which is available at this link. Also, insider Cristal N. Downing sold 2,361 shares of the company’s stock in a transaction that occurred on Thursday, February 6th. The shares were sold at an average price of $88.76, for a total transaction of $209,562.36. Following the completion of the transaction, the insider now owns 7,085 shares in the company, valued at approximately $628,864.60. This 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.

Hedge Funds Weigh In On Merck & Co., Inc.

Several hedge funds have recently bought and sold shares of the business. Principal Financial Group Inc. lifted its position in Merck & Co., Inc. by 8.9% in the third quarter. Principal Financial Group Inc. now owns 6,355,950 shares of the company’s stock worth $721,782,000 after purchasing an additional 518,270 shares during the period. Texas Capital Bank Wealth Management Services Inc increased its holdings in Merck & Co., Inc. by 24.6% during the 3rd quarter. Texas Capital Bank Wealth Management Services Inc now owns 2,382 shares of the company’s stock valued at $271,000 after purchasing an additional 470 shares in the last quarter. Two Sigma Advisers LP lifted its position in Merck & Co., Inc. by 157.9% during the 3rd quarter. Two Sigma Advisers LP now owns 4,264,100 shares of the company’s stock worth $484,231,000 after buying an additional 2,610,800 shares in the last quarter. Wills Financial Group Inc. grew its stake in shares of Merck & Co., Inc. by 1.9% during the third quarter. Wills Financial Group Inc. now owns 30,162 shares of the company’s stock valued at $3,425,000 after purchasing an additional 550 shares during the last quarter. Finally, Weiss Asset Management LP acquired a new stake in shares of Merck & Co., Inc. in the 3rd quarter valued at $10,138,000. 76.07% of the stock is owned by institutional investors and hedge funds.

About Merck & Co., Inc.

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.