Pharmaceuticals giant Merck & Co., Inc. (MRK) on Thursday saw its earnings estimates lowered by analysts at Credit Suisse.
The firm said it cut its estimates for MRK through 2013, noting that AstraZeneca plc (AZN) will likely exercise its call option on heartburn drugs Nexium and Prilosec. Under a previous agreement between the two drug giants, AZN retains the right to repurchase Merck’s interests in Prilosec and Nexium in the U.S. in 2012.
Still, Credit Suisse maintained its “Outperform” rating and $44 price target on MRK, suggesting a nearly 24% upside to the stock’s Wednesday closing price of $35.61.
Merck shares posted modest gains in premarket trading Thursday.
The Bottom Line
Shares of Merck (MRK) have a 4.72% dividend yield, based on last night’s closing stock price of $35.61. The stock has technical support in the $31-$33 price area. If the shares can firm up, we see overhead resistance around the $36-$38 price levels.
Merck & Co., Inc. (MRK) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.
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