Analyst Note
| Damien Conover, CFA |Merck reported strong first-quarter results ahead of our projections, but we don’t expect any major changes to our fair value estimate. We view the stock as undervalued, with the market not fully appreciating the firm’s solid growth potential driven by immuno-oncology drug Keytruda, human papillomavirus vaccine Gardasil, and animal health drugs. The strong positioning of these products along with a robust portfolio and improving pipeline reinforces Merck’s wide moat.