Recent insider trends for Merck & Co., Inc. (NYSE:MRK) have caught the attention of investors. Insider data is useful because it can reveal what a company’s executives and largest shareholders feel about a stock. In this case, the data has some interesting things to say about how MRK might perform in the future.
Institutions own 74.31% of Merck & Co., Inc. (MRK)’s shares. The total value of these holdings, in millions, is $112,316. Among active positions in the latest quarter, 854 holders increased their positions by a total of 66.58 million shares, 877 holders decreased the positions by a total of 82.12 million shares, and 261 holders held their positions. This works out to a net decrease in ownership of 15.54 million shares, and suggests that institutions are feeling bearish about the stock.
Among new and sold out positions, 80 holders initiated new positions by a total of 5.82 million shares and 73 holders exited their positions by a total of 6.31 million shares. This nets out to a decrease of 495311 shares and is another bearish sign for MRK.
In the last three months, insiders executed a total of 1 trades. 1 were sells. Insider ownership decreased by a total of 5000 shares, which suggests that MRK’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 11 buys and 16 sells, and ownership decreased by a net of 23638 shares.
Short interest, or the number of a stock’s tradable shares currently being shorted, is another metric investors use to get a pulse on sentiment. Merck & Co., Inc. (NYSE:MRK)’s short interest is 16.96 million shares, or % of the float. This represents a decrease of -11% in the number of shares being shorted compared to the previous reading, and implies that investors felt less pessimistic about the stock during the past two weeks.
Supplementing insider data with technical indicators can help an investor form a more complete view on the outlook for a stock. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that MRK is a Strong sell, which implies that MRK is expected to underperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that Merck & Co., Inc. (NYSE:MRK) is overvalued.