Billionaire Mario Gabelli’s 10 Large-Cap Stock Picks with Huge Upside Potential

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

Gamco Investors Equity Stake: $7.88 Million

Market Capitalization as of May 5: $208.01 Billion

Stock Upside Potential as of May 5: 39.37%

Number of Hedge Fund Holders: 91

Merck & Co., Inc. (NYSE:MRK) is a science and technology company that develops and markets innovative medicines, vaccines, and diagnostics for oncology, diabetes, cardiovascular, and virology. While the stock has been under pressure over the past year, analysts at Guggenheim Securities insist it is a Buy despite cutting the price target to $108 from $115.

The analysts maintain a buy rating in the aftermath of the healthcare company delivering solid first-quarter 2025 results that exceeded Wall Street estimates. Revenue totaled $15.53 billion against $15.31 billion expected as earnings per share totaled $2.22, beating consensus estimates of $2.14. The impressive results were fueled by strong sales of the company’s flagship cancer drug, Keytruda, which helped offset the slow growth of Gardasil sales in China.

Nevertheless, Merck & Co., Inc. (NYSE:MRK) lowered its profit outlook for the year by $200 million, citing additional tariff costs. The company has built a significant presence in China that will be hit hard by the US-China trade war. Nevertheless, the company is poised to spend $1 billion on a new factory to make US supplies for its blockbuster cancer drug Keytruda. The facility is to produce an array of biological medicines and an easier-use version of Keytruda as the company seeks to reduce its dependence on China.