Should You Consider Investing in Merck (MRK)?

Miller Howard Investments, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly return of 3.5% (yield) was recorded by the fund for the third quarter of 2021, compared to the 1.5% for the S&P 500 for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

Miller Howard Investments, in its Q3 2021 investor letter, mentioned Merck & Co., Inc. (NYSE: MRK) and discussed its stance on the firm. Merck & Co., Inc. is a Kenilworth, New Jersey-based pharmaceutical company with a $194.0 billion market capitalization. MRK delivered a -1.52% return since the beginning of the year, while its 12-month returns are down by -1.06%. The stock closed at $76.81 per share on December 29, 2021.

Here is what Miller Howard Investments has to say about Merck & Co., Inc.  in its Q3 2021 investor letter:

“While optimistic about a recovery, we continue to balance our cyclical holdings with dividend-payers in stable, less economically-sensitive industries. We hold three pharmaceutical companies, (which includes) Merck (MRK). All three have strong cash flows and balance sheets, making their high dividends reasonably safe. The investment controversy surrounding these pharma companies is whether they can develop or acquire new products to replace their current blockbuster drugs. The low valuations on these stocks reflects what we believe to be undue pessimism by investors on the prospects for new drugs.”

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Based on our calculations, Merck & Co., Inc. (NYSE: MRK) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. MRK was in 77 hedge fund portfolios at the end of the third quarter of 2021, compared to 79 funds in the previous quarter. Merck & Co., Inc. (NYSE: MRK) delivered a 4.76% return in the past 3 months.

In June this year, we also shared another hedge fund’s views on MRK in another article. You can find more than 100 investor letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q3 page.

Disclosure: None. This article is originally published at Insider Monkey.