Merck & Co., Inc. (MRK) Stock Up Amid Relypsa Inc. (RLYP) Buyout Rumors


Merck & Co., Inc. (NYSE:MRK) shares are trading up this afternoon, after there are rumors swirling that the company is preparing to make an offer to acquire Relypsa Inc. (NASDAQ:RLYP).

If Merck & Co., Inc. (NYSE:MRK) were to make a bid for the $1.07 billion bio therapeutic company, they will probably need to outbid several other companies who have also shown a strong interest. While this rumor has some fuel to it, more than likely nothing will happen until after the new year and Relypsa will certainly exhaust all of their potential options before making any decision.

Any move to acquire Relypsa would be a good one on Merck & Co., Inc.’s (NYSE:MRK) behalf, barring that they don’t significantly overpay. Relypsa is known best for their drug Veltassa, which is intended to treat hyperkalemia (elevated levels of potassium in the blood).

It should be interesting to continue and follow both companies as more news comes out on a possible acquisition. The stock is up 1.86% or $0.98 following the news, hitting $53.57 per share. About 7.74M shares traded hands. MRK has declined 12.15% since May 1, 2015 and is downtrending. It has underperformed the S&P500 by 9.36%.

From a total of 8 analysts covering Merck & Co. Inc. (NYSE:MRK) stock, 6 rate it a “Buy”, 0 a “Sell”, and 2 a “Hold”. This means that 75% of the ratings are positive. The highest target price is $70 while the lowest target price is $55. The mean of all analyst targets is $64.17 which is 19.79% above today’s ($53.57) stock price. Merck & Co. Inc. was the topic of 11 analyst reports since August 13, 2015 according to the firm StockzIntelligence Inc. Barclays Capital upgraded shares on December 1 to a “Overweight” rating. BMO Capital Markets upgraded shares to a”Outperform” rating and a $70 target share price in their report from an August 13. Argus Research maintained MRK stock in a recent report from November 17 with a “Buy” rating. Finally, JP Morgan maintained the stock with a “Overweight” rating in a report they issued on a September 21.

The institutional sentiment decreased to 1.06 in Q2 2015. It’s down 0.07, from 1.13 in 2015Q1. The ratio dropped, as 73 funds sold all their Merck & Co., Inc. shares they owned while 622 reduced their positions. 111 funds bought stakes while 627 increased their total positions. Institutions now own 2.06 billion shares which is 4.95% less than the previous share count of 2.16 billion in 2015Q1.

Srb Corp holds 11.49% of its total portfolio in Merck & Co., Inc., equating to 1.52 million shares. Barry Investment Advisors Llc owns 145,946 shares representing 8.36% of their total US portfolio. Moreover, Alpine Investment Management Llc has 8.11% of their total portfolio invested in the company, equating to 1.14 million shares. The Arkansas-based Foundation Resource Management Inc has a total of 7.05% of their portfolio invested in the stock. Orbis Investment Management (U.S.) Llc, a California-based fund reported 146,941 shares owned.

Merck & Co., Inc. is a global health care company. The company has a market cap of $147.44 billion. The Firm offers health solutions through its prescription medicines, vaccines, biologic therapies and animal health products, which it markets directly and through its joint ventures. It has 14.28 P/E ratio. The Company’s Pharmaceutical segment includes human health pharmaceutical and vaccine products marketed either directly by the Company or through joint ventures.