Morgan Stanley analyst Terence Flynn maintained a Hold rating on Merck & Company yesterday and set a price target of $109.00.
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Terence Flynn has given his Hold rating due to a combination of factors tied to Merck’s near-term outlook and longer-range ambitions. While inaugural 2026 revenue and EPS guidance largely align with Morgan Stanley’s refreshed estimates, modest top-line growth of 1-3% and earnings drag from the Cidara acquisition underscore limited upside. The guidance also factors in reduced share repurchases relative to 2025, signaling less capital return support for the stock.
Flynn points to management’s confidence in more than $70 billion of potential commercial opportunities by the mid-2030s, yet emphasizes that many key assets remain in development and will not be substantially de-risked until 2027. Continued focus on business development, especially within the $1-15 billion sweet spot, reflects the need to backfill Keytruda’s approaching loss of exclusivity. Keytruda’s current performance is solid, but the company’s long-term transition depends on successful execution of the pipeline and strategic deals, supporting a Hold stance until greater visibility emerges.
Flynn covers the Healthcare sector, focusing on stocks such as Pfizer, BioNTech SE, and Bristol-Myers Squibb. According to TipRanks, Flynn has an average return of 10.4% and a 59.64% success rate on recommended stocks.
In another report released on January 28, Citi also maintained a Hold rating on the stock with a $115.00 price target.