Merck & Co. Inc. (NYSE:MRK) shares were trading higher on Friday on a continued rally on better-than-expected third-quarter earnings and upbeat fiscal 2026 guidance.
On Thursday, the company reported adjusted earnings of $2.49 per share, beating analysts’ expected earnings of $2.08.
Revenue increased 5% year over year to $18.085 billion, beating the consensus estimate of $17.313 billion, reflecting increased contributions from new products as well as strength in Oncology and Animal Health.
Analyst On Sales Timing And Price Target Increase
Guggenheim raised its price forecast from $170 to $171, while maintaining its Buy rating.
Analyst Vamil Divan said sales benefited from timing of purchases by approximately $550 million, which accounts for much of the sales beat relative to expectations.
Oncology Pipeline Strength And Keytruda Patent Expiry Preparation
Additionally, Guggenheim sees continued confidence in the potential upside of multiple assets across their Oncology product portfolio, including sac-TMT and intismeran (INT).
Divan called Merck’s three Presidential Symposia at the European Society for Medical Oncology meeting earlier this month an impressive showing for its pipeline as it prepares for Keytruda’s upcoming loss of exclusivity.
Divan wrote that “ESMO meaningfully de-risks two of Merck’s most important growth drivers.”
The INTerpath-001 trial in partnership with Moderna Inc. (NASDAQ:MRNA) delivered the first positive Phase 3 results for an individualized neoantigen therapy under development for skin cancer.
The U.S. Food and Drug Administration accepted Sacituzumab tirumotecan (Sac-TMT) Biologics License Application under priority review, with a decision date of June 15.
Upcoming Clinical Catalysts And Long-Term Growth Outlook
The analyst continues to see Merck as one of its top large-cap biopharma picks and “a name investors should want to own going into the numerous potential upcoming clinical catalysts.”
Following these earnings and the recent ESMO conference, Guggenheim said it is now focused on the uptake of the recently approved Lipfendra, the design and execution of the Phase 3 CHORUS trial investigating Winrevair in CpcPH-HFpEF, and multiple important upcoming clinical data readouts.
RBC Capital also maintains Merck with a Sector Perform, but lowered the price forecast from $145 to $140.
MRK Price Action: Merck shares were up 2.75% at $150.35 on Friday. The stock is approaching its 52-week high of $156.91, according to Benzinga Pro data.
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