Summary
- Merck continues to see the benefit of growing Keytruda sales as legacy sales are coming in flat, after a long time of steady declines.
- This translates into steady overall sales growth, and thus earnings growth, with shares trading at a market multiple.
- I still consider shares a core holding, even as I have taken some profits earlier around $80 per share.
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Merck (MRK) continues to see real operating momentum as growth of Keytruda is really overshadowing declines at the legacy business, which is actually coming in flat. Growing earnings and cash flows allow the company to funnel money into the pipeline at the same time.
Earlier this year, that is at the start of February, I noted that the contribution of Keytruda is finally fairly valued by the market, making me a continued holder of my core position which I have initiated last year at levels in the mid-fifties.
