Bretman
Merck $MRK (Merck & Co.) is a name that looks kind of interesting to me when I look at the technicals and fundamentals — even as healthcare names have been out of favor. 📊 Technicals: The stock is knocking against downtrend resistance. If it can clear this level — and clear the 21-day and 50-day MAs — maybe we get a nice snapback rebound. If we get that move, traders could consider using a stop-loss just below the recent low near $94 in an attempt to contain their losses. Remember, stocks can always gap down BELOW your expected stop-loss. MRK shares are down about 26% from the recent highs and are sitting near the 200-week moving average, which has generally been supportive over the last decade. ✳️ Daily and weekly charts are posted below, but MRK's charts can also be found and customized by using this link: www.etoro.com/app/procharts?instruments=MRK 🤓 Fundamentals: The firm is forecast to grow revenue just 5% to 6% in 2025 and 2026, but net income and free cash flow are expected to jump more than 20% in 2025. The stock pays a 3.25% dividend yield, which isn't crazy, but shouldn’t be ignored either. From a valuation perspective, both forward P/E and forward P/FCF are both near trough levels of the past decade. 🚨 Risks Merck was founded in 1891 (!) and has grown into a $260 billion pharmaceutical giant. While that builds a moat in some instances, the industry and healthcare sectors are under pressure, with political concerns mounting. That presents one risk. Then there are your standard risks of owning individual stocks, which are often accompanied by increased volatility vs. an index like $SPX or $NSDQ100. Like many others, Merck’s risks include unexpected announcements, disappointing earnings, and leadership shake-ups. There’s also the risk that the stock flat-out underperforms or that the current breakout doesn’t stick. This is surface level analysis, but put it all together and $MRK has some interesting components to take note of. Obviously this isn’t investment advice, but I thought I'd share a part of my process. Cheers 🍀
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