Why Barclays Upgraded Merck to ‘Overweight’ on April 5


Nov. 20 2020, Updated 11:35 a.m. ET

Barclays upgrades Merck on April 5

On April 5, 2018, Barclays (BCS) updated its recommendation for Merck (MRK) to “overweight” from “equal weight,” and Barclays analyst Geoff Meacham raised its target price from $62 to $64. Merck stock rose ~1% during the day but closed April 5 ~0.02% lower.

In the same report, Geoff Meacham downgraded Biogen’s (BIIB) rating and lowered Pfizer’s (PFE) price target. We’ll discuss Barclays’s recommendation update on Pfizer in the next article.

Article continues below advertisement

Analyst’s rationale on upgrade

According to Meacham, there is a potential to grab a ~15%–20% market share of the US first-line lung cancer treatment market. He expects Merck to continue to hold a higher market share, driven by positive data from its clinical trials. The success of the company’s Keytruda Phase 3 study trial, which we discussed in the previous part of this series, boosted the company’s stock price. Also, Meacham believes that Merck has a better outlook than competitors, primarily Bristol-Myers Squibb (BMY). Over the years, Merck has been better positioned in the first-line lung cancer market than Bristol-Myers Squibb.

Wall Street analysts’ recommendations on MRK stock

Of the 21 analysts covering MRK stock on April 10, 2018, 14 (~67%) recommended “buy” or “strong buy,” and seven (~33%) recommended “hold.” There were no “sell” recommendations. Analysts’ average 12-month target price for MRK stock is $66.55, which implies a ~16.7% return over the next 12 months based on its closing price of $56.16 on April 9.

Check out all the data we have added to our quote pages. Now you can get a valuation snapshot, earnings and revenue estimates, and historical data as well as dividend info. Take a look!


More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.