Barclays Upgrades Merck, Downgrades Competitor Pfizer

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Barclays upgraded Merck to chubby from equal weight on higher alternatives versus its competitors.

It additionally downgraded Pfizer to equal weight from chubby, citing a much less doubtless probability of a “transformative” acquisition.

Analyst Geoff Meacham and his crew additionally raised their worth goal on Merck by $2 to $64, a greater than 17 p.c improve from Wednesday’s shut.

“In our view, there’s maybe 15 to 20 p.c of first-line lung market share ‘up for grabs’ within the U.S.,” the analysts mentioned in a notice to buyers Thursday. Meacham additionally famous a greater outlook versus key rivals, specifically Bristol-Myers Squibb.

Merck shares closed 0.02 p.c decrease at $54.53 a share, giving up an intraday spike of greater than 1 p.c. The inventory has fallen 3 p.c this 12 months.

Meacham and his crew lowered their worth goal on Pfizer by $3 to $38, nonetheless greater than 5 p.c above Wednesday’s shut.

“In our view, present ranges largely seize the upside for key merchandise reminiscent of Prevnar, Ibrance, Xeljanz and Xtandi,” the report mentioned. “Our earlier Chubby score was primarily based on the potential for a transformative acquisition, which might speed up the expansion profile and supply a clearer strategic route, which we now view as much less doubtless within the close to time period” primarily based on latest interplay with administration, together with the CFO.

Pfizer shares closed 1.1 p.c decrease Thursday at $35.73. The inventory is down 1.35 p.c for the 12 months.

Within the Thursday report, the Barclays analysts additionally downgraded Biogen to equal weight from chubby.

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