MRK- wise move?

[jiesen]

I dipped my toe in the MRK waters today at 26. Anyone think this is an unwise move?

[billyjoe]

Jiesen, I wish you well having bought within a cent of the low for at least 52 weeks. My concerns would be possible lawsuits . Yesterday a reporter stated that they've documented 27,000 strokes and heart attacks linked to MRK product and that MRK knew about it 4 years ago. Even if this is totally false , how long will it take to clear this up? The nearest city to me with a population of 20 some thousand already has lawyers placing ads soliciting "victims" of MRK . Multiply that by hundreds or thousands of cities and it gets scary. Maybe you can make a quick buck and get out before it's too late. This is just my opinion and I've been known to be wrong before.
billyjoe

[mrmarket]

If someone ever read the label on a VIOXX bottle that was in their friend's medicine cabinet, he will join the lawsuit. This will make Phen-Fen look like a fart.

Even if the litigation gets settled, this will hang over MRK's head like the sword of Damacles. It's amazing how far this company has fallen from the Vagelos days when it was the most admired company in America. It's really a shame.

I say this because MRK is a stock I've held in my "buy and die" portfolio for 20 years.

[Websman]

If I bought MRK right now, it would be for a day trade only...

[jiesen]

Well, I figure there's a point where the lawsuits etc are all priced in, and this may be it. How much will it take? 6, 8, 12 billion? who knows, but once it's worked out, and the sword is removed, the company should bounce back- at least to 40 or 50, if they're still paying over $1/shr dividend by then. It's not like Vioxx was the only product they had going for them.

Also, with Bush in office, I like MRK's odds against the lawyers. I say no more than $10B is lost, and not all at once. A $30B hit is currently priced in. What do you think?

By the way Billyjoe, I didn't get it at 26.00 (would have been nice) but actually at 26.15.

[spikefader]

I dipped my toe in the MRK waters today at 26. Anyone think this is an unwise move?

Well, they do say wisdom:
* is being able to recognize the significant in the factual;
* is having the ability to filter the inessential from the essential;
* is having the characteristic of not doing desperate things;
* lies in simplification;
* consists of anticipation of consequences;

But my favorite (and the one that most relates to trading) is by Theodore Roosevelt, who said,
"Nine-tenths of wisdom consists of being wise in time".

Whatever happens to your long MRK position, just make sure you're "wise in time" and use a protective stop, and be prepared for the possiblity of losing substantially more than you think possible on an enormous gap down after further terrible news.

But I take it by your "dipped my toe in'" description that it's a small position and you're not over exposed.

On the technical side, the chart screams bearishness.
This link shows Point & Figure bearish projection of $4.00 (bottom of page)

http://stockcharts.com/gallery?mrk

Good luck with it.

[New-born baby]

Mrk

Jiesen,

Remember companies like Auther-Anderson? Braniff? TWA? K-Mart? What am I saying? Big companies can die. Star companies can die with bad management. MRK had bad management to put that junk on the market.

My thoughts would be: the market has finally got rid of a great weight off of its shoulders; why buy a gut-shot dog on its way down? Why not buy the cream of the cream?

I might short MRK, but I myself wouldn't buy it long when Mr. Markets says it's all about "earnings, earnings, earnings." And with a $10B hit minimum, it isn't going to show big earnings for awhile.

The truth about MRK is that many of its big winners will soon be on the generic market, and MRK will lose some big income. Furthermore, according to my study, MRK doesn't have anything great coming down the pipeline at this time. Prospects did not look all that hot BEFORE the Viiox fiasco; they look awful now.

I am not writing to insult you in any way; I am writing to say I'd jump ship Monday at 9:30 a.m.

But take that with a grain of salt; I am no Mr. Market. You'll have to make your own decisions. I am just telling you what I would do.
Very best investing to you always.

[MEA_1956]

Mrk

If it were me and I were pondering this ? I do believe I would have waited a while longer and let a solid base develope. As stated eariler who knows where the next suprise may lie. For example, CPJY.pk 4/1 split, started an up treand after the split and then dipped again. Then the bad wording on the press releases caught up with then, and there will probably be a set back or two more before they have wind at there back and a clear path to sail into.===> MEA

[jiesen]

Many thanks to all of you for weighing in on this. The fact that both $$MM and Spike are warning me about this trade makes me think twice about what I'm doing in MRK. I am definitely using a stop on this one. I'm going to ratchet it up pretty tight, and if it has me out at 9:30 Monday, so be it... But I still see a great value in MRK. I know that giants can fall, and fall big. I've seen it and felt it pretty badly myself (ELN for one!) Spike's chart pointing to a drop to $4 is a sobering thought, but I can see it happening. When uncertainty and panic take over the stock, the market's overreaction can be amazing. Hopefully, if this happens, it'll have stopped me out at 25, and let me back in at 15 (or 5!).

But I fully intend to ride these shares up to 50 and beyond. (call me crazy)

MEA: A funny thing about patience... I seem to have a lot more of it after I buy than before! I think I need to work on that.

[New-born baby]

Mrk

Jiessen,

Hey, we all out here want the very best for you in all your investing, including MRK. I just don't have the guts (or foresight, perhaps) to go get it. But I hope you get it!

Still, if I got a tiny .10 profit on Monday, I'd take it!

[dlb53151]

I dipped my toe in the MRK waters today at 26. Anyone think this is an unwise move?

I jumped in at $29 and have since doubled down 2X. I am cautiously optomistic. In hindsight, there is a bit much uncertainty right now with this stock, so strap on the seat belt. I think you s/b fine at $26. Bottom line, there are probably better buys right now with less turbulence.

[mrmarket]

This could end up following the trend of the tobacco stocks. I don't see any real issues with MRK being able to sustain cash flow. Wall Street might stay away for a while, but they may end up pumping up their dividend to lure investors back.

[New-born baby]

60 minutes

Jiessen,

60 minutes is going to have a hit piece on MRK this Sunday night. In the program they are going to try to go after management as knowing the drug was no good. The New York Times also had a lengthy piece on it today, and they really get after MRK management. Someone somewhere scrounged up some MRK insider documents to verify "the Truth." Hang on.

I say "the Truth" because these are the same dingfods who came up with the forged documents about Pres. Bush's Air National Guard record. All you need now is Dan Rather after MRK.

[jiesen]

Dan Rather? Bring him on. I've noticed that the release of bad news about MRK is becoming less frequent now, and it isn't having the impact on the share price that it did a few weeks ago. I think it's made the base here at 26, and will hang out here for awhile, probably drift higher through any patches of no news. I'm thinking like $$MM here, and relate to the tobacco stock model as worst case scenario. Merck will continue to pay the dividend, may even increase it, and the lawsuit liabilities will be pushed back as late as possible, and probably reduced significantly in the end.

Anyway, I could be wrong, and if it breaks below 25, I'm taking my money and running.

Jiesen,

60 minutes is going to have a hit piece on MRK this Sunday night. In the program they are going to try to go after management as knowing the drug was no good. The New York Times also had a lengthy piece on it today, and they really get after MRK management. Someone somewhere scrounged up some MRK insider documents to verify "the Truth." Hang on.

I say "the Truth" because these are the same dingfods who came up with the forged documents about Pres. Bush's Air National Guard record. All you need now is Dan Rather after MRK.

[New-born baby]

Official Apology

Jiessen,

I just checked the price on MRK, and we're looking at 27.52. It seems your bottom fishing expedition has proved to be very, very successful. I am here to offer my sincere congratulations to you, and an apology for urging you to bail. I was wrong. Great job!

Now, if you can bottom fish this good all the time, would you mind telling us what kind of worm you are using?