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To: Sonny McWilliams who wrote (13953)	12/4/1997 12:52:00 PM
From: Sonki	Read Replies (1) \| Respond to of 27012

MERCK & CO. (MRK) 98 CLOSED. GOing to 120 This pharmaceutical concern is expected to quickly get off the gate this morning as Wall Street is again falling in love with the sector after a pause during the summer when valuations got ahead of the sector's growth trend. However, Wall Street is again starting to refocus on these issues with DLJ reiterating its "buy" rating on Merck and setting a price target of $120 a share on the stock. Yesterday, the company met with analysts and made positive remarks about its outlook for the next couple of years, stating that it was comfortable with 1997 EPS estimate of $3.8--$3.84 a share and 1998 EPS of $4.35 to $4.53 a share. Growth in the sector continues to expand at a 15% annual rate and the drug pipeline continues to produce new products with significant margins that are allowing this group to reinvest in more research and development. Merck continues to enjoy earning growth of 19% and is still able to raise prices while increasing unit volume as well. While the week started off on the wrong foot when investors grew concerned over Warner-Lambert's (WLA 119 5/8) diabetes drug Rezulin due to possible liver problems and the decision by Glaxo-Wellcome (GLX 45 1/2) to discontinue the sales of Romozin in the U.K., after an initial hitch, the sector has been able to overcome any investor worries as the group as a whole continues to outperform the market. For this reason, Wall Street is again pushing the drug stocks, and Merck is expected to be one of the beneficiaries of the positive-spin campaign.