Saturday, August 30, 2014

A New Analyst Firm's Coverage Of Merck: Deutsche Bank Starts At $65

Okay, during the week (while I was out, on Wednesday), Deutsche Bank began coverage -- on Merck.

Deutsche Bank has a "hold" on the name, with a target of $65. That makes sense, given that Merck has now touched -- and surpassed the $60 mark.

Two things that $60 event imply: One, Merck's dividend yield is now just under three per cent. . . generally a good thing (Merck is both a growth stock, and yet a pretty fat dividend payer!) -- and two, the Bank's 12 month target is actually only like seven per cent above Friday's close. Still a suggestion that Merck is pretty fully valued here. Just my $0.02. [I could wax cynical, and suggest that the bank would like to win some debt underwriting business from Merck (for the other side of its house), and so put a slightly outsized target on Merck's price -- I think $65 is the top quote at the moment. But I'll restrain my cynicism.]

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