It’s becoming increasingly apparent that the global economy and life as we know it will not return to normal until a coronavirus vaccine is developed, approved and administered. Until then, we can expect high market volatility as the COVID-19 cases increase significantly in certain areas of the world, while others have gotten a better handle on it. An investor looking for investment opportunities should take a close look at the leaders in the race to develop the first effective coronavirus vaccine. Merck has taken a big step to pursue two vaccines, and we’ve taken a look at how it could impact their stock prices.
How Merck’s Efforts Impact Stock Prices
Merck is partnering with the International AIDS Vaccine Initiative and has purchased the biotech firm Themis to expedite the process of developing two coronavirus vaccines. The company has also begun working with Ridgeback Bio to aid in the discovery of an antiviral treatment for COVID-19. These efforts have not yet resulted in significant changes in Merck’s stock prices, and this likely won’t be the case until one or both of their vaccines get approved by the Food and Drug Administration.
Merck’s Annual Numbers
Despite Merck’s earnings rising roughly 23% in the first quarter of 2020, its stock has actually declined by nearly 13% this year. Still, Merck is in a solid position with its stock being ranked the seventh-best out of all other pharmaceutical companies. In 2019, their sales grew by 11% and industry experts expect their sales to increase by about 3% by the end of 2020. The projected increases are much lower than they have been in recent years, but their income is still projected to reach above $5 per share by the end of the year.
Does Merck Offer Great Investment Opportunities Now?
Every investor has to decide whether they fully believe in a pharmaceutical company’s ability to be the first to develop an approved coronavirus vaccine. However, when you look closely at investment opportunities, it’s ideal to look at a company’s history and not make a decision based solely on recent events. Merck has developed multiple vaccines and treatments this year that have been approved by the Food and Drug Administration, so they are worth keeping a close eye on. Earnings have continued increasing, but their growth has not exceeded 20%. This is a key indicator of the potential success of long-term investment opportunities for Merck, and it may be best for an investor to take a wait-and-see approach with Merck stock.
At Stock Investing Info, we are watching the coronavirus vaccine development closely every day. Some companies offer risky opportunities with the potential for high rewards, while there are other safer bets an investor can take. When it comes to your portfolio management, we suggest looking at historical data rather than recent news before making an investment decision. Never hesitate to contact us if you have any questions or concerns about investing in any pharmaceutical companies during these volatile times.