Saturday, January 28, 2023

Merck Is Still Pretty Compelling -- At $106... With Q4 2022 Earnings Due Next Thursday


In times of general consumer price inflation, and a fairly stagnant job market, overall. . . the "counter-cyclicals" -- or defensive stocks. . . often become screaming buys (as was true in the late 1970s). This is -- again -- one of those times.

True, in the heady "go-go" times of early 2022, these big pharmas looked pretty. . . boring (cough! when compared to. . . Bitcoin!). . . but while Bitcoin is now down over 75% in the last 12 months, Merck is up over 44%.

How'z 'bout them marbles?

And, with this recent pull-back to around $106 this week, on the NYSE. . . it is hard to argue with the name remaining a very solid buy in 2023 -- its longer term demographic markets are. . . compelling. Life-saving, in fact.

Condor predicts. . . the company will post results that are either in-line, or a slight beat, at the GAAP EPS line, net of acquisitions, this coming Wednesday. [And that is no mean feat -- in and of itself, in these volatile times.]

And in a choppy market, getting a cash juggernaut, at about a 12 or 13 Earnings Multiple. . . knowing that will continue to mid 2030s. . . is a very solid risk adjusted bet.

I'll hush now -- have a great weekend.

नमस्ते

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