MRK Sinks After Abandoning COVID-19 Vaccine Program

The equity has had a volatile run on the charts during the past 12 months

Deputy Editor
Jan 25, 2021 at 9:47 AM
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    The shares of Merck & Co., Inc. (NYSE:MRK) are off 1.2% to trade at $80 this morning, following news that the pharmaceutical company is ending its COVID-19 vaccine development program. The firm said both of its vaccines generated inferior immune responses, and plans to shift its focus to pandemic research on treatment, adding that its expects initial data on its experimental oral antiviral to be due out by the end of March. 

    The past 12 months have been quite choppy for MRK, though its most recent major pullback in December staged a bounce off the $78 mark, before running into trouble at the frequently resistant $86 level. Shares have once again pulled back to test their footing at the 200-day moving average, which has kept the security afloat numerous times during the past three months. 

    Despite its volatility, analysts are optimistic on the stock. Of the 13 in coverage, 10 say "strong buy." Plus, the 12-month consensus price target of $96.60 is a 20.8% premium to last night's close. 

    Option traders have taken a sunny outlook on MRK, too. This is per the equity's 10-day call/put volume ratio of 4.57 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than 78% of all other readings from the past year. This means long calls are being picked up at a relatively quicker-than-usual clip. 

     

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