Can Merck Make It 6 in a Row for the Dow?
Mar 12th 2013 11:03AM
Updated Mar 12th 2013 11:06AM
As the Dow Jones Industrials continues to forge ahead to new highs, many investors have become anxious about just how long the bull-market run can last. But for those looking for reassurance, finance professor Jeremy Siegel gave an interview in which he said the Dow could climb to 18,000 by next year, citing near-zero interest rates on fixed-income investments and a recovery in the housing market and overall economy. That explosive move up won't happen in a single day, but for now, as of 10:50 a.m. EDT, the Dow is up 20 points, even though the Nasdaq and S&P 500 are down slightly.
Merck is the big gainer in the Dow, rising 3.3% after the company said it would continue to run a trial on its Vytorin cholesterol drug. Although sales of Vytorin and related drug Zetia have fallen in recent years on concerns about safety, but an independent panel pointed to a lack of any safety problems so far in the trial. Although the ideal resolution for Merck would have been for the panel to say that the study could end because the drug had proven itself effective, investors took the news as an optimistic assessment of Vytorin's potential to reduce heart attacks, strokes, and heart-related deaths.
Outside the Dow, Heckmann rose 11.5% following a promising earnings report. The water treatment specialist beat estimates on earnings and revenue for the fourth quarter, reversing a year-ago loss and doubling its sales over last year's quarter. Heckmann also gave optimistic guidance for the current year, citing strength in the energy industry. Shareholders will also get to vote on a name change to Nuverra Environmental Solutions at the company's annual meeting, which may confuse investors for a while if approved, as it will change the ticker symbol to NES as well.
Finally, Cabela's is up 11% after providing earnings guidance for the current quarter that was $0.10 to $0.15 per share above analyst estimates. With same-store sales seen rising at rates in the high teens, the sporting-goods retailer is taking advantage of a boom throughout the industry. Investors will get more news at the company's investor day tomorrow, but for now, things look good for Cabela's.
Merck is a titan in the pharmaceutical industry, and lately it has worked hard to overcome its patent cliff and ongoing pipeline problems. Find out more about Merck's prospects in our premium research report on the pharma giant, in which the Fool tackles all of the company's moving parts, its major market opportunities, and reasons both to buy and to sell. To find out more, click here to claim your copy today.
The article Can Merck Make It 6 in a Row for the Dow? originally appeared on Fool.com.Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool owns shares of Heckmann and has the following options: Long Jan 2014 $4 Calls on Heckmann and Short Jan 2014 $3 Puts on Heckmann. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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