Morgan Stanley Dubs Merck Overweight on Cancer Pipeline Optimism
Morgan Stanley upgraded Merck & Co.'s (MRK) rating to Overweight from Equalweight and more than doubled its price target, citing growing confidence in the company's oncology pipeline.
The upgrade was led by Morgan Stanley analyst Terence Flynn, who raised his price target to $179 from $116, implying roughly 17% upside from Wednesday's close. Flynn said the firm has gained more confidence in Merck's drug pipeline and overall business strategy.
The catalyst for the upgrade was positive Phase 3 results from Merck and Moderna (MRNA) for their personalized mRNA cancer vaccine. The results showed strong clinical benefits for patients with melanoma, raising the potential for the treatment to become a significant growth driver for Merck in the coming years.