Insight Guru flags valuation flip as Merck trades at 52.2x operating profit vs Lilly 25.3x - MRK News | RalliesInsight Guru flags valuation flip as Merck trades at 52.2x operating profit vs Lilly 25.3x
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MRK• Valuation reversal between Merck and Eli Lilly
- Insight Guru analysis flagged a valuation reversal between Merck and Eli Lilly, with Merck now trading at a premium despite slower growth.
- Market pricing implies 52.2x price-to-operating-income for Merck versus 25.3x for Lilly, a flip from 10.3x versus 30x a year ago.
- Merck’s trailing operating income fell 64.8% over the last 12 months, inflating the multiple as investors focus on pipeline execution.
- Management points to more than $70 billion in commercial opportunity from over 20 new products to offset eventual Keytruda patent expiry.
- Lilly shows stronger momentum, with last-12-month revenue growth of 49.6% versus 4.6% for Merck, pressuring the premium’s justification.
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