Merck (MRK) Shows Strong Earnings Following M&A Adjustments; Outlook Flat

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MRK Hot Sheet

EPS Growth %: +7.6%

Financial Fact:
Income Before Taxes: 10.82B

Today's EPS Names:
TNP, MENT, More

Merck & Co., Inc. (NYSE: MRK) shares are showing some early weakness Thursday following its fourth-quarter results.

Sales at Merck improved 1.7 percent from $12.094 billion during the same quarter last year to $12.294 billion. The number compared with Street views calling for revs of $12.53 billion.

Merck swung into positive territory, reporting net income of $1.512 billion, from a loss of $531 million in the year-ago quarter. The number played-out to earnings of 49 cents per share. Excluding one-time charges related to acquisitions and other items, EPS rose to 97 cents versus expectations of 95 cents.

Leading sales higher was Singular with an 8 percent increase in fourth-quarter revenue. Januvia sales popped 42 percent to $960 million in the period, a strong move for the diabetes drug. Inflammatory disease treatment Remicad posted the most notable decline, however, with sales dropping 28 percent to $511 million in the quarter following the transfer of rights to Johnson & Johnson (NYSE: JNJ).

Looking ahead, Merck sees fiscal 2012 non-GAAP EPS of $3.75 - $3.85 with revs at or near 2011 levels on a constant currency basis. The Street is modeling EPS of $3.83 and revs of $47.62 billion.

The stock last traded at $38.13, down 1.3 percent from Wednesday's close.

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