5 Healthcare Stocks to Buy According to Billionaire DE Shaw

4. Merck & Co., Inc. (NYSE:MRK)

D E Shaw Stake Value: $266,419,000
Percentage of D E Shaw’s 13F Portfolio: 0.24%
Number of Hedge Fund Holders: 77

Merck & Co., Inc. (NYSE:MRK) is a multinational pharmaceutical corporation that develops, manufactures, and distributes medications for humans and animals.

In November, Morgan Stanley analyst Matthew Harrison cut his price target on Merck & Co., Inc. (NYSE:MRK) to $82 from $88 and maintained an “Equal Weight” rating on the stock, citing the new COVID variant Omicron as proof of the pandemic’s persistent variation risk. According to the analyst, mRNA vaccines, some antibody treatments, and Pfizer Inc.’s (NYSE:PFE) oral are the most likely to benefit.

Merck & Co., Inc. (NYSE:MRK) recently saw a decrease in hedge fund sentiment. The number of long hedge fund positions declined to 77 in the third quarter compared to 79 positions in the previous quarter.

In its first-quarter 2021 investor letter, Artisan Partners mentioned Merck & Co., Inc. (NYSE:MRK). Here is what the fund said:

“In Q1, we initiated a position in Merck, a provider of health care solutions including prescription medicines, vaccines, biologic therapies, animal health and consumer care products. We purchased Merck when the stock came under pressure in part on concerns that the newly minted Biden administration could implement regulatory changes and lower drug costs in the pharmaceutical industry. Recent, but anticipated changes to Merck’s management team have also weighed on shares, as have concerns over the company’s heavy reliance on immunotherapy treatment Keytruda. Notably, Merck is not getting much credit from investors for the 60+ programs it has in clinical development, despite having several solid and large new product opportunities. Additionally, the company’s strong balance sheet and robust free cash flow provide it multiple options for future partnerships and acquisitions. While Merck is undergoing a period of transition, we think the company’s fundamentals are strong and believe changes to management should be a catalyst for improvement.”