Merck & Co., Inc. (NYSE:MRK) Shares Gap Down - Here's Why

Key Points

• Merck & Co., Inc. shares opened at $79.85, down from a previous close of $84.06, indicating a significant drop in value before trading on Tuesday.
• Wall Street analysts have shown varying outlooks for Merck, with the consensus rating at "Hold" and an average price target of $108.69, while several firms have adjusted their ratings and price targets downward.
• The company declared a quarterly dividend of $0.81 per share to be paid on October 7th, representing a 4.01% yield based on its current share price.

Merck & Co., Inc. (NYSE:MRK - Get Free Report) gapped down prior to trading on Tuesday . The stock had previously closed at $84.06, but opened at $79.85. Merck & Co., Inc. shares last traded at $79.55, with a volume of 5,014,841 shares trading hands.

Wall Street Analysts Forecast Growth

A number of analysts have issued reports on MRK shares. Wall Street Zen cut shares of Merck & Co., Inc. from a "strong-buy" rating to a "buy" rating in a research note on Friday, April 25th. Guggenheim restated a "buy" rating and issued a $115.00 price objective on shares of Merck & Co., Inc. in a research note on Thursday, April 17th. Morgan Stanley reduced their price objective on shares of Merck & Co., Inc. from $99.00 to $98.00 and set an "equal weight" rating for the company in a research note on Thursday, July 10th. Cantor Fitzgerald cut shares of Merck & Co., Inc. from an "overweight" rating to a "cautious" rating in a research note on Tuesday, May 20th. Finally, Citigroup reaffirmed a "neutral" rating and issued a $84.00 target price (down previously from $115.00) on shares of Merck & Co., Inc. in a research note on Wednesday, May 14th. One analyst has rated the stock with a sell rating, twelve have given a hold rating, seven have assigned a buy rating and one has issued a strong buy rating to the company. According to MarketBeat.com, the company has a consensus rating of "Hold" and an average target price of $107.44.

Merck & Co., Inc. Price Performance

The firm has a market capitalization of $197.39 billion, a PE ratio of 12.08, a price-to-earnings-growth ratio of 0.83 and a beta of 0.39. The business has a 50-day moving average of $80.37 and a 200 day moving average of $84.80. The company has a current ratio of 1.41, a quick ratio of 1.16 and a debt-to-equity ratio of 0.69.

Merck & Co., Inc. (NYSE:MRK - Get Free Report) last released its quarterly earnings results on Tuesday, July 29th. The company reported $2.13 EPS for the quarter, beating analysts' consensus estimates of $2.03 by $0.10. The business had revenue of $15.81 billion during the quarter, compared to analyst estimates of $15.92 billion. Merck & Co., Inc. had a return on equity of 41.63% and a net margin of 25.79%. As a group, research analysts anticipate that Merck & Co., Inc. will post 9.01 EPS for the current fiscal year.

Merck & Co., Inc. Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Tuesday, October 7th. Shareholders of record on Monday, September 15th will be paid a $0.81 dividend. The ex-dividend date is Monday, September 15th. This represents a $3.24 annualized dividend and a yield of 4.1%. Merck & Co., Inc.'s dividend payout ratio (DPR) is currently 49.92%.

Institutional Inflows and Outflows

Several large investors have recently added to or reduced their stakes in the stock. Peoples Financial Services CORP. boosted its stake in Merck & Co., Inc. by 0.5% in the 2nd quarter. Peoples Financial Services CORP. now owns 22,778 shares of the company's stock worth $1,803,000 after purchasing an additional 122 shares during the period. McLean Asset Management Corp boosted its position in shares of Merck & Co., Inc. by 3.7% during the 2nd quarter. McLean Asset Management Corp now owns 3,543 shares of the company's stock valued at $292,000 after acquiring an additional 125 shares during the last quarter. Cora Capital Advisors LLC boosted its position in shares of Merck & Co., Inc. by 2.4% during the 2nd quarter. Cora Capital Advisors LLC now owns 5,343 shares of the company's stock valued at $423,000 after acquiring an additional 125 shares during the last quarter. Foundation Wealth Management LLC PA boosted its position in shares of Merck & Co., Inc. by 2.4% during the 1st quarter. Foundation Wealth Management LLC PA now owns 5,361 shares of the company's stock valued at $481,000 after acquiring an additional 127 shares during the last quarter. Finally, Saiph Capital LLC boosted its position in shares of Merck & Co., Inc. by 3.7% during the 1st quarter. Saiph Capital LLC now owns 3,565 shares of the company's stock valued at $320,000 after acquiring an additional 128 shares during the last quarter. Institutional investors own 76.07% of the company's stock.

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.