We recently published a list of Should You Buy the Dip and Follow Insiders into These 10 Stocks?. In this article, we are going to take a look at where Merck & Co., Inc. (NYSE:MRK) stands against other stocks insiders were piling into recently.
After a turbulent week, stocks began recovering on Monday, with all three major indexes posting gains. The broader market index rose 0.64%, blue-chip stocks gained 0.85%, and the NASDAQ Composite, still in correction territory, closed 0.31% higher.
Early Tuesday, stocks began to decline again as investors focused on the Federal Reserve’s two-day policy meeting starting today. The key announcement for traders will come Wednesday when the Fed announces its interest rate decision, followed by a press conference with Fed Chair Jerome Powell. Since September, the Fed has cut interest rates three times and still, the broader market entered a correction.
Despite uncertainty from President Trump’s shifting tariff policies and geopolitical strategies, some analysts remain optimistic about AI’s future.
“We retain our view that there is more to go in stocks, and we keep our conviction in the long-term opportunities in stocks linked to both the artificial intelligence and power and resources transformational innovations,” UBS chief investment office said in a note Monday, according to CNBC.
Amid turbulence and uncertainty on Wall Street, looking at recent insider trades can provide valuable insights, as executives often have a deeper understanding of their companies. For example, when a CEO or CFO buys company stock, it may indicate strong confidence in the business’s future.
However, insider selling doesn’t always signal a lack of confidence. It could be due to personal financial needs or a desire to diversify investments. These sales are often made through pre-arranged plans, like 10b5-1 plans, to avoid any appearance of improper timing.
While insider activity can be informative, it’s important to consider it alongside the company’s financial health, market trends, and industry developments.
Our Methodology
We used Insider Monkey’s insider trading stock screener to analyze recent trading activities in several popular stocks. For each stock, we noted the number of insiders who recently acquired shares and the company’s market capitalization.
Our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds, focusing on insider trading and stock picks from hedge fund investor newsletters and conferences. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A close-up of a person’s hand holding a bottle of pharmaceuticals.
Merck & Co., Inc. (NYSE:MRK)
Number of Insiders Buying: 2
Market Capitalization: $239.44 billion
Merck & Co., Inc. (NYSE:MRK) is a healthcare company focused on the development of treatment for oncology, immunology, neuroscience, virology, cardiovascular diseases, and diabetes. The Rahway, New Jersey-headquartered company also operates an animal health division concentrated on veterinary pharmaceuticals, vaccines, and health management solutions. It is a dividend-paying stock and one of the 7 most undervalued biotech stocks to invest in.
For the full year of 2024, the company reported sales of $64.16 billion, compared to $60.12 billion in 2023.
Among the recent company’s developments is the European Commission’s conditional approval for Merck & Co.’s WELIREG (belzutifan), the first oral HIF-2α inhibitor in the EU, for two indications: treatment of adult patients with von Hippel-Lindau (VHL) disease and advanced clear cell renal cell carcinoma.
Merck & Co. (NYSE:MRK) also recently announced positive results from two Phase 3 trials of a new HIV treatment called doravirine/islatravir (DOR/ISL). This once-daily, oral, two-drug regimen was tested in adults whose HIV is already well-controlled on other therapies. In both trials, DOR/ISL worked just as well as current treatments and met safety goals after 48 weeks. The results will be presented at the 32nd Conference on Retroviruses and Opportunistic Infections (CROI) in San Francisco. Merck (NYSE:MRK) plans to apply for approval to sell this new treatment by mid-2025.
In February, two insiders bought a total of $1.577 million worth of Merck & Co. shares at an average price of $88.38 per share. Since the beginning of the year, the stock declined 4.71% and now trades at $94.79. Over the past 12 months, its shares lost 21.94%.
The consensus rating on Merck & Co. stock from 23 analysts is “Moderate Buy,” according to MarketBeat. The analysts have projected a price of $117.12, suggesting a potential upside of 23.49%.
Overall, MRK ranks 3rd on our list of stocks insiders were piling into recently. While we acknowledge the potential of MRK, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MRK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
