Merck (MRK) stock rose about 4% on Monday, as of writing, after top Wells Fargo analyst Mohit Bansal upgraded his rating for the pharma company to Buy from Hold. Bansal increased the price target for MRK stock to $125 from $90, expressing confidence in the company’s pipeline.
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Wells Fargo Analyst Turns Bullish on MRK Stock
Based on recent business development efforts, advancements in pipelines, and new launches, Bansal is confident about Merck’s ability to fill the shortfall that will be caused by the patent expiration of its blockbuster cancer drug Keytruda in 2028. The 5-star analyst sees the company growing its top line in the early 2030s.
“MRK is entering a catalyst-rich period in the next 12-18 months with readouts across its pipeline,” stated Bansal. The analyst no longer sees a major decline in Merck’s revenue in the 2029 to 2031 period, as previously feared.
Furthermore, Bansal noted that Merck’s pharma business is currently trading at about 8.7x his 2026 estimate, which he believes is low, given the massive value in the company’s portfolio. In particular, the analyst sees the potential for unadjusted peak pipeline sales at more than $50 billion and at $23 billion on an adjusted basis.
Interestingly, Q3 2025 marked the first time that quarterly sales of Keytruda surpassed $8 billion. The company is targeting annual cost reductions of $3 billion by the end of 2027, as it prepares to mitigate revenue losses from the patent expiration of Keytruda. Merck recently announced the acquisition of Cidara Therapeutics (CDTX) in a $9.2 billion deal. Through this acquisition, Merck will gain access to Cidara’s experimental flu drug, which is expected to help the company diversify ahead of Keytruda’s patent loss.
Is Merck Stock a Good Buy Right Now?
Overall, Wall Street has a Moderate Buy consensus rating on Merck stock based on five Buys and nine Holds. The average MRK stock price target of $101.16 indicates shares are fully priced at current levels.
