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Is this Large Market Cap Stock target price reasonable for Merck & Co., Inc. (NYSE:MRK)?

The company in question is, Merck & Co., Inc. (NYSE:MRK) currently with a stock price of 61.52 (-1.00% today). The market cap for Merck & Co., Inc. is 171128.34, and is in the sector Healthcare, and Drug Manufacturers – Major industry. The target price for Merck & Co., Inc. is 66.47. Currently Merck & Co., Inc. is trading with a P/E of 33.69, and a forward P/E of 15.79. Average volume for Merck & Co., Inc. is 10202.84 and so far today it is 12914900.

Performance in the last year for Merck & Co., Inc. has been 23.48%. For EPS growth, Merck & Co., Inc. has seen a growth of -61.60%, and is looking to grow in the next year to 4.01%. More long term stats show that EPS growth has been 41.50% over the last five years and could be 6.57% for the next five years. Merck & Co., Inc. has seen sales growth quarter over quarter at 0.60%, with EPS growth quarter over quarter at 79.20%. The 20-day simple moving average is -1.58%, with the 200-day simple moving average coming to 10.24%.

Since the IPO date for Merck & Co., Inc. on the 1/2/1970, Merck & Co., Inc. has seen performance year to date to be 19.32%. With Merck & Co., Inc. trading at 61.52, the dividend yield is 2.99%, and the EPS is 1.83.

So could Merck & Co., Inc., be undervalued? Well as said before P/E is 33.69. The PEG is 5.13, P/S is 4.34 and the P/B is at 3.93. The P/cash is 14.46, with P/free cash flow at 36.04.

Merck & Co., Inc. ability to deal with debt shows that the current ratio is 1.9, and the quick ratio is 1.5. This is with long term debt/equity at 0.55, and total debt/equity at 0.56.

In terms of margins, Merck & Co., Inc. has a gross margin of 63.20%, an operating margin of 18.10% and a profit margin of 13.00%.Payout ratio for Merck & Co., Inc. is 99.50%. Return on assets come to 5.20% with return on investment coming to 6.40%.

Insider ownership for Merck & Co., Inc., is at 0.04% and institutional ownership comes to 74.60%. Outstanding shares are at 2781.67. While shares float is 2759.66. The float short is currently 1.01%, and short ratio is 2.72.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Stephen Butters

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