Merck (NYSE:MRK) Presents Promising KEYTRUDA Trial Data at AACR 2025 Meeting
We've identified 1 possible red flag with Merck and understanding the impact should be part of your investment process.
NYSE:MRK Earnings Per Share Growth as at Apr 2025
These 13 companies survived and thrived after COVID and have the right ingredients to survive Trump's tariffs. Discover why before your portfolio feels the trade war pinch.
The recent success of Merck's KEYNOTE-689 trial and its potential to enhance investor confidence could further strengthen the company's narrative around robust pipeline growth. This aligns well with Merck's strategy of driving future success in its oncology and cardiometabolic sectors through innovative launches like WINREVAIR. Despite short-term setbacks, such as the paused shipments of GARDASIL in China, Merck's long-term growth outlook remains positive, as these developments may bolster revenue and earnings forecasts significantly.
Over the past five years, Merck's total shareholder return, inclusive of share price appreciation and dividends, was 31.62%. In the recent year, however, Merck underperformed, with the US Pharmaceuticals industry seeing a 1.3% increase in returns, while Merck struggled to keep pace amidst market challenges. Despite these near-term hurdles, the market response to the positive trial results has been promising, pushing Merck's current share price toward the consensus analyst price target of US$108.98, suggesting potential upside.
Insights from our recent valuation report point to the potential undervaluation of Merck shares in the market.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Forbes
a few seconds ago
- Forbes
Walmart's Stock Price Is Up Despite New Transshipment Tariffs
Walmart prides itself on its everyday low prices. Being a low-cost retailer has been a key contributor to Walmart's status as the world's largest retailer. A key reason for Walmart's 'everyday low prices' is the procurement of goods from low-wage, low-cost nations, such as China or India. In 2023, goods from China accounted for 60% of product sales. India is the second largest source of imports. Between January and August 2023, 25% of Walmart's U.S. imports originated in India. Higher tariffs, of course, threaten the EDLP strategy. But the new tariffs on transshipments are even more painful for retailers relying on low-cost foreign imports. The New York Times points out that ever since President Trump began raising tariffs on goods from China during his first term, Chinese companies have raced to set up warehouses in Southeast Asia and Mexico to bypass US tariffs through the use of indirect shipments. On July 31st, Trump signed an executive order targeting transshipments. Goods deemed by the Customs and Border Patrol to have been transshipped to evade applicable country of origin duties are now subject to an additional 40% import tax on top of the applicable country of origin tariff rates. These rates will take effect on August 7th. The legal definition of transshipment is a good that did not undergo a 'substantial transformation' in the country through which it passed. For example, the US-Mexico-Canada Agreement requires that at least 75% of cars be manufactured in North America based on North American-sourced components to qualify for duty-free treatment. So, for example, goods that flow to Mexico from China, where final consumer packaging is done, would be a light form of value-add. These goods would almost certainly be considered transhipped products. The executive order did not go into detail on the exact amount of value-add needed to avoid the 'transshipment' designation. Surprisingly, the new transshipment tariffs have not led to a decline in Walmart's stock price. On July 31st, when the new rules were announced, Walmart's stock closed at $97.98. Today, the stock opened at $99.67. Walmart's ability to pass these higher tariff costs on to consumers may be somewhat constrained. In May, Walmart said that it planned to increase prices, possibly by June, to pass along the higher tariff costs. 'We have always worked to keep our prices as low as possible, and we won't stop. We'll keep prices as low as we can for as long as we can, given the reality of small retail margins,' a Walmart spokesperson explained. Trump strongly disagreed with that idea. He wrote on Truth Social that Walmart needs to stop using tariffs as an excuse for increasing prices across its stores. And said that with Walmart having seen enormous profits last year, Walmart should absorb the costs associated with tariffs, instead of passing them on to customers. Walmart has worked to get its foreign suppliers to absorb some of the higher costs. Walmart asked several Chinese apparel and kitchenware suppliers to cut prices by up to 10% per tariff round. For many of these suppliers, Walmart is by far their largest customer and thus has substantial negotiating leverage. But these price decrease requests are much larger than what suppliers are used to. Further, the Chinese government is pushing back. According to The Wall Street Journal, Chinese officials summoned Walmart executives following complaints from suppliers. Authorities criticized the retailer's demands as unfair, warning that forcing suppliers to absorb tariff costs could breach contracts and disrupt market stability. Legal consequences were reportedly mentioned during the discussions. China can help exporters by devaluing its currency, which lowers the price of exports. They're also giving tax breaks and other incentives to their exporters, trying to keep them afloat. These tactics are something they have done in the past. But these things have been roundly criticized by the US and other Western nations. Experts on retailing say that, despite the President's call for retailers to 'eat the tariffs,' retailers will not be willing to absorb all of those increased prices. 'This idea that the president says, 'Listen, retailers, eat the tariffs.' That's not going to happen,' Kevin O'Leary of Shark Tank explained. Suppliers, retailers, and customers will all absorb some of the higher costs driven by tariffs. Even before the transshipment announcement, Walmart was struggling to forecast results. The retail giant did not release a profit outlook for the first quarter of the year due to the uncertainty surrounding the economy and tariff-related costs. Walmart on Thursday shared that its profits slipped in the first quarter of the year to $4.45 billion. It's difficult to understand why Walmart's stock price did not slump. Was it because many don't fully understand the potential impact of the transshipment tariffs? Or is it because Walmart has a strong history of growth despite headwinds? Or do some believe this transshipment rule will be difficult to enforce? How could US Customs and Border Patrol detect transshipments? If we take Walmart as an example, and assume they wanted to avoid transshipment tariffs (which I do not assume), the CBP would look for changing patterns in shipment origins. Walmart operates 20 distribution centers in Mexico. These warehouses are advertised as supporting the Mexican market. If shipments from these DCs started flowing across the border to the US, that would be evidence that Walmart is looking to avoid transshipment tariffs. What would be more challenging for the CPB to detect is a shift from FOB at origin to FOB at destination. FOB stands for "freight on board." The term is used to describe the point in a transaction where a product being shipped becomes the property of the buyer. In an FOB Origin shipping arrangement, the buyer is the owner of the product as soon as it leaves the point of origin. In an FOB Destination shipping arrangement, the shipment becomes the property of the buyer when it reaches a specified destination in the shipping process. In general, in an FOB destination contract, the seller of products plans all the logistics. In FOB origin arrangement, the buyers often designate which shipping company to use and even which lane a shipment should move on. Large companies frequently believe that by taking responsibility for logistics, they can save money. But a shift to FOB at origin contracts could allow suppliers to more easily evade transshipment duties by adding an extra port to the end-to-end shipment and thus sell prices to a retailer at a lower price.
Washington Post
a few seconds ago
- Washington Post
Trump EPA plans to claw back $7 billion in rooftop solar grants
The Environmental Protection Agency plans to terminate $7 billion in grants for rooftop solar projects that were supposed to serve lower- and middle-income consumers, according to two people familiar with the matter, in the Trump administration's latest move to undercut renewable energy. The EPA plans to draft letters to the 60 grant recipients under the Solar for All program — which includes 49 states — informing them that their awards have been terminated. With the program only launching in 2024, the vast majority of the money has yet to be spent, leaving it vulnerable to being clawed back by the administration.
CNBC
a few seconds ago
- CNBC
A technical look at Wall Street's 'fear gauge' and how to hedge against potential volatility
As Fundstrat's Tom Lee says, this is the most hated bull market of all time, yet it continues to power higher. There are plenty of overhanging uncertainties that could derail this rally that I'll discuss below, but first let's talk about technical condition of this rally. This V-shape recovery-turned-rally from April lows has been unrelenting. Any minor pullbacks are bought up and those left on the sideline are still waiting for a sizable pullback to enter. It could continue to power higher leaving those on the sideline chasing momentum and entries at new highs, or, the numerous overhanging threats to this market could begin to manifest and pullback may be ahead of us. We can't know. No one knows the future. All we can do is control our process in the present and plan accordingly. To avoid the concern that we need to be able to predict the future to successfully invest in the markets, we recently deployed a VIX hedge to our Active Opps portfolio at Inside Edge Capital with a favorable risk-reward ratio. If the market does pullback the VIX hedge will provide some protection to our portfolio while we're able to hold onto the strong names we've been building here with you every Tuesday on CNBC Pro. The S & P broke out from the late 2024 highs at around 6,140 and have not yet re-tested that breakout zone as support. It's not required, but it would be nice to see this checkback to this significant technical level. Also located in this zone is the 50 period moving average (dotted purple). You'll also notice the rate of change indicator below that has been in a decisive downtrend. To use a baseball analogy as I'm running travel baseball tryouts tonight, if you throw a ball in the air the speed of ascent will decelerate until the rate of change is zero and gravity takes over and pulls the ball back to the ground. The same thing here. At some point buyers will exhaust themselves and sellers will come in. Looking at the Volatility Index (VIX) overlay with the S & P 500 you'll notice that there is a clear inverse relationship between the two. As the stock market falls, fear and the accompanying price of option insurance goes up. Home insurance on a house with a smoldering foundation is going to be a lot more expensive than a calm clear day. The VIX at 17 is still relatively cheap so insurance is still reasonable. Plus you'll notice that I've outlined a divergence between late 2024 and now. With the S & P 500 at new highs, the VIX should be sub-15, but as mentioned above there are so many overhanging threats to the market investors are buying up the insurance policy keeping the VIX somewhat elevated. Specifically, we went to the VIX September monthly call options and bought the 23 strike and then sold the 29 call. The difference between the two should be around $1.50 for that $6 spread so that means you're risking $150 to make $450 if the VIX is above 29 on Sept. 17. As mentioned, there are threats to the market that we all know about including a Fed that may not be ready to drop rates despite many calling for it, persistent inflation driven by strong demand tariff pressures, Geopolitical tensions, narrowing breadth in the market as mega-cap hyper scalers are starting to lead once again, and finally seasonality. September is historically the worst month for the S & P 500. Hopefully we won't need the hedge and will close it at a loss. But if we do need it and the market is going to pullback, we can maintain our strong portfolio and not dislodge the low cost basis of names we've been building this year. -Todd Gordon, Founder of Inside Edge Capital, LLC We offer active portfolio management and regular subscriber updates like the idea presented above. DISCLOSURES: (Gordon owns VIX call spreads personally and in his wealth management company Inside Edge Capital) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
