10 Best Pharma Stocks To Buy Right Now

2. Merck & Co., Inc. (NYSE:MRK)

Number of Hedge Fund Holders: 96

Merck & Co., Inc. (NYSE:MRK), headquartered in Rahway, New Jersey, is a prominent American multinational pharmaceutical company with historical ties to the original Merck Group, founded in Germany in 1668. Known globally as Merck Sharp & Dohme (MSD), the company is highly regarded for its contributions to pharmaceuticals and vaccines.

Merck & Co., Inc. (NYSE:MRK) reported a 4% boost in third-quarter 2024 revenue, bringing in $16.7 billion, driven by strong sales of its cancer drug KEYTRUDA and the launch of Winrevair. While Gardasil sales declined by 10%, mainly due to lower demand in China, the company remains optimistic about future growth, targeting $11 billion in sales by 2030. Merck & Co., Inc. (NYSE:MRK) also shared positive clinical developments and new FDA approvals, further expanding its oncology portfolio.

On October 25, Barclays reaffirmed its Overweight rating and a $140 price target for Merck & Co., Inc. (NYSE:MRK) following new data from competitor Arcus Biosciences on its HIF-2α inhibitor, casdatifan. The data highlighted a 34% objective response rate (ORR), with a 25% confirmed ORR, presenting some competition for Merck’s cancer drug, Welireg. However, Barclays noted that the confirmed-to-unconfirmed response ratio did not represent as significant a competitive shift as initially expected.

As of Q2 2024, Insider Monkey data shows that 96 hedge funds held stakes in Merck & Co., Inc. (NYSE:MRK), with Millennium Management as one of the largest shareholders, holding shares valued at approximately $1.18 billion.

Oakmark Equity and Income Fund stated the following regarding Merck & Co., Inc. (NYSE:MRK) in its Q3 2024 investor letter:

“Merck & Co., Inc. (NYSE:MRK) is a global pharmaceutical firm with leading oncology, vaccine and animal health franchises. Premier products in Merck’s portfolio include Keytruda, Gardasil, Winrevair and Bravecto. Outsized contributor Keytruda is an immuno-oncology drug that treats several cancers and tumors. Keytruda is an astounding clinical and commercial success that is on track to become one of the best-selling prescription drugs to date. Investor angst surrounding Keytruda’s pending U.S. patent expiration in 2028 presented a chance to buy shares at a discounted valuation. We believe opportunities to extend Keytruda’s duration through life cycle management are underappreciated. More importantly, discounted cash flows from products already on market cover today’s entire stock price, meaning there is minimal value ascribed to a promising pipeline with strong sales potential. We believe Merck is led by a capable management team that looks to reinvest these cash flows in an accretive manner.”