NEW YORK (Trefis) -- Merck (MRK) recently declared its results for the first quarter. A lot happened during this quarter that can potentially impact the company's ongoing business. During this period, it reported uniform growth across all segments with better cost control and gains from certain nonrecurring items ensured net earnings jump of nearly 67% from $1.07 billion to $1.77 billion.
The noteworthy nonrecurring items were $500 million gain related to resolution of the arbitration proceedings with Johnson & Johnson (JNJ) and $134 million gain on sale of certain manufacturing assets. If we analyze the results excluding the nonrecurring items and restructuring costs, the results are still encouraging with almost 9.1% growth in earnings compared to same period last year.
Merck operates in four segments namely, pharmaceutical, animal health, consumer care and alliance segment and competes with other health care companies like Pfizer (PFE), Johnson & Johnson and Abbott Labs (ABT).Check out our complete analysis of Merck Sales of HIV drug Isentress increased from $292 million to $337 million in the first quarter of 2012, showing a growth rate of 15%. In January 2012, Merck received FDA approval for Isentress for use in children older than 2 for HIV therapy. The company reports Isentress revenue as part of anti-infectives segment. It is a very important drug for Merck, given that it earned revenue of $1.4 billion in 2011 and showed historical growth rates of 25% and 45% in 2011 and 2010, respectively. With this approval, we expect Isentress to be a major source of prospective revenue for Merck and to improve market share in that segment. The anti-infectives segment contributes over 25% to the company value. Janumet sales increased from $305 million to $392 million in the first quarter of 2012, showing nearly 29% growth. In February 2012, Janumet got FDA approval for use in type 2 diabetes. It is a once-daily treatment to control blood sugar. This will help Merck strengthen its already formidable position in alimentary and metabolism drugs segment, which contributes nearly 20% to the company value. We expect Merck to gain market share in this segment going forward.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV