Merck & Co. (MRK) has been reiterated as a "Buy" by BofA Global Research, despite a reduction in its price objective to $112 from $118, following a mixed Q4 performance. The report highlights a significant impact from lowered Gardasil sales guidance, which overshadowed a Q4 earnings beat. Merck's FY2025 guidance fell short of expectations, with projected revenues of $64.1B-$65.6B and EPS of $8.88-$9.03, compared to BofA's estimates of $69.2B and $9.63, respectively.
The report notes that Gardasil's challenges, particularly in China, have shifted focus to Merck's other key products like Keytruda, which faces competitive pressures. BofA has adjusted its 2025 estimates, reducing revenue and EPS forecasts by 4% and 5%, respectively. Despite these setbacks, BofA maintains a positive outlook on Merck's valuation, citing its robust late-stage pipeline and growth potential. "We continue to think at these levels the upside>downside and reiterate Buy," the report states.
Merck's stock was trading at $88.77, down 2.17% as of February 5, 2025, at 9:40 AM.