Jim Cramer’s Latest Calls: Top 10 Stocks

2. Merck & Co Inc (NYSE:MRK)

Number of Hedge Fund Investors: 95

Jim Cramer was asked by a caller during his latest program whether he should hold MRK. Here is what Cramer said:

“No, you should not hold MRK, you should buy MRK. I have tremendous, tremendous faith in what Robert M Davis (MRK CEO) is doing.”

Wall Street expects Merck & Co. Inc. (NYSE:MRK) 2025 EPS to come in at $9.95. Based on the stock’s current price, Merck & Co. Inc.’s (NYSE:MRK) forward P/E ratio is 13.13, compared to the industry average of 19.79 and lower than Merck’s 5-year average P/E of 18.67. Wall Street expects Merck & Co. Inc.’s (NYSE:MRK) revenue to jump 7.30% while earnings growth is expected to clock in at 15.00%. Wall Street estimates suggest Merck’s EPS will grow to $12.5 by the end of fiscal year 2028. This translates to a CAGR of 7.6% between fiscal years 2024 and 2028.

Analysts believe Merck & Co. Inc. (NYSE:MRK) has done a decent job at diversifying its drug portfolio and expanding across different geographies. The company makes money from vaccines and immunotherapy drugs

Sales growth momentum of Keytruda is also expected to continue as the drug is patent-protected until 2028. Merck & Co. Inc. (NYSE:MRK) is also investing heavily into R&D to make new drugs for unmet medical needs, such as oncology and immuno-oncology. Average analyst price estimate for Merck & Co. Inc. (NYSE:MRK) is $140, which presents a 22% upside potential from the current levels.

Carillon Eagle Growth & Income Fund stated the following regarding Merck & Co., Inc. (NYSE:MRK) in its first quarter 2024 investor letter:

“After posting lackluster returns in 2023, Merck & Co., Inc. (NYSE:MRK) got off to a strong start in January by raising the long-term sales forecasts for its oncology and cardiology pipelines and reporting solid fourth-quarter results, coupled with strong financial guidance for 2024. Merck shares also finished the quarter strong after receiving U.S. Food and Drug Administration approval in late March for a new cardiology medicine with the potential to contribute significantly to sales growth over the next several years.”