What to Expect From Merck Earnings

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Merck & Co. (NYSE: MRK) is scheduled to release its third-quarter earnings report after before the markets open on Tuesday. The consensus estimates from Thomson Reuters are $0.98 in earnings per share (EPS) and $10.18 billion in revenue. In the same period of last year, Merck posted EPS of $0.96 on $10.07 billion in revenue.

Prior to its presentation at the European Society for Medical Oncology in mid-October, Merck announced that Keytruda (pembrolizumab), demonstrated superiority in overall survival at 18 months compared to standard of care chemotherapy (docetaxel) in patients with metastatic non-small cell lung cancer previously treated with platinum-containing chemotherapy whose tumors expressed PD-L1, as well as patients with high levels of PD-L1 expression.

Roy S. Herbst, M.D., Ph.D., professor of medicine and chief of medical oncology, Yale Cancer Center and Smilow Cancer Hospital at Yale, New Haven, commented:

These findings – which show superior survival with longer follow-up across patients with PD-L1 expression (tumor proportion score of one percent or more), as well as improved quality of life – point to KEYTRUDA as a durable treatment option for many previously treated patients with advanced non-small cell lung cancer. These data also reinforce the value of using PD-L1 as a biomarker to identify patients who are likely to benefit from KEYTRUDA.

Ahead of the earnings report, a few analysts weighed in on Merck:

  • Jefferies reiterated a Hold rating with a $65 price target.
  • Merrill Lynch has a Buy rating with a $70 price target.
  • Leerink reiterated a Market Perform rating with a $65 price target.
  • Barclays reiterated an Overweight rating.
  • Argus reiterated a Buy rating with a $65 price target.
  • Morgan Stanley has a Hold rating with a $60 price target.
  • Sanford Bernstein has an Outperform rating with a $74 price target.

So far in 2016, Merck has outperformed the broad markets, with the stock up about 16%. Over the past 52 weeks, the stock is up roughly the same amount.

Shares of Merck were trading at $61.00 on Monday, with a consensus analyst price target of $68.00 and a 52-week trading range of $47.97 to $64.86.