Mon Mar 10 20:40:00 UTC 2025: ## Market Volatility and Undervalued Stocks: Merck & Co. Among Hedge Fund Favorites

**NEW YORK, March 6, 2025** – Amidst ongoing market volatility fueled by tariff uncertainty, financial experts are offering mixed signals. While some highlight the underlying strength of the US economy, others urge caution due to unpredictable policy shifts. This comes as a new report identifies Merck & Co., Inc. (NYSE:MRK) as one of the top ten most undervalued US stocks favored by hedge funds.

CNBC’s “Closing Bell Overtime” featured commentary from Paul Hickey of Bespoke Investment Group and Phil Camporeale of JP Morgan Asset Management on March 5th. Camporeale acknowledged the challenges posed by fluctuating trade policies, noting that JP Morgan has reduced its equity overweight from 10% to 5% to reallocate assets across different markets. Despite short-term market turbulence, he remains optimistic about the long-term prospects of the US economy given its low unemployment rate and solid corporate balance sheets, predicting low recession risks.

Hickey, however, emphasized the significant uncertainty created by tariffs and other policy decisions, citing Target CEO Brian Cornell’s concerns. He highlighted the short-lived nature of recent market rallies and cautioned investors to proceed with prudence, referencing historical market pullbacks.

This backdrop adds context to a new report from Insider Monkey ranking the top 10 most undervalued US stocks favored by hedge funds. Merck & Co. (MRK), with a forward P/E ratio of 10.34 and held by 91 hedge funds (as of Q4 2024), ranks sixth on this list. The report uses data from Insider Monkey’s database tracking over 1000 elite money managers and focuses on stocks with forward P/E ratios under 15.

Merck’s strong performance is driven primarily by its oncology segment, specifically KEYTRUDA, which saw a 21% surge in Q4 2024 sales. However, challenges remain, as noted by GreensKeeper Asset Management, who highlighted temporary setbacks in GARDASIL 9 sales due to inventory issues in China.

While the report highlights Merck’s potential, it also suggests that AI stocks may offer even more promising returns in the shorter term. The full report, including a detailed list of undervalued stocks, is available at [link to Insider Monkey report].

Read More