Merck makes a big acquisition

Article Excerpt

MERCK & CO. INC., $114.76, is a buy. The drugmaker (New York symbol MRK; TSINetwork Rating: Above Average) (www.merck.com; Shares outstanding: 2.5 billion; Market cap: $294.6 billion; Dividend yield: 2.5%) now buying San Diego-based Prometheus Biosciences Inc. for $10.8 billion. Prometheus could provide significant growth in a key new area. Autoimmune drugs are some of the industry’s biggest sellers and can command high prices; as such, companies are searching for next-generation products in this area. This acquisition adds a potentially strong franchise in immune-mediated/fibrotic for Merck. That would diversify its focus outside of oncology, infectious disease, and cardio-metabolic disorders. Merck & Co. is a buy. buy. …