Merck Surges 4.7% on $9.2B Cidara Acquisition and Winrevair Breakthrough: Is This the Start of a New Pharma Era?

Summary
• Merck (MRK) surges 4.7% to $97.26, hitting a $97.29 intraday high after announcing a $9.2 billion acquisition of Cidara Therapeutics.
• Phase 2 CADENCE trial for Winrevair (sotatercept-csrk) meets primary endpoint in pulmonary hypertension, fueling investor optimism.
• A $0.85 quarterly dividend for early 2026 underscores financial stability amid Keytruda challenges.

Merck’s stock is trading at its highest level since late 2024, driven by a blockbuster acquisition and clinical trial success. The $9.2 billion Cidara deal adds a late-stage antiviral candidate to Merck’s pipeline, while Winrevair’s Phase 2 success in pulmonary hypertension signals a potential new revenue stream. With a 4.7% intraday gain and a 52-week high of $105.07 still in reach, investors are weighing whether this momentum can sustain.

Cidara Acquisition and Winrevair Trial Spark Bullish Sentiment
Merck’s 4.7% surge is directly tied to two transformative events: the $9.2 billion acquisition of Cidara Therapeutics and the positive Phase 2 CADENCE trial results for Winrevair. The Cidara deal, valued at $221.50 per share, secures CD388, a long-acting antiviral candidate with Breakthrough Therapy Designation for influenza prevention. This acquisition diversifies Merck’s portfolio beyond Keytruda, addressing investor concerns over the latter’s patent expiration risks. Meanwhile, Winrevair’s success in treating pulmonary hypertension due to heart failure with preserved ejection fraction (HFpEF) opens a $1.2 billion market opportunity. The dual catalysts—strategic M&A and clinical progress—have reignited confidence in Merck’s long-term growth narrative.

Pharma Sector Rally: Merck Outpaces Pfizer’s 1.1% Gain
The pharmaceutical sector is in a bull phase, with Merck outperforming peers like Pfizer (PFE), which rose 1.1% on the day. Merck’s acquisition of Cidara and Winrevair’s trial success position it as a leader in respiratory and antiviral innovation, contrasting with Pfizer’s recent focus on generic drug sales. The sector’s broader optimism is fueled by favorable FDA designations and a shift toward high-margin specialty drugs. Merck’s 4.7% gain reflects its ability to execute on both M&A and R&D, while Pfizer’s muted performance highlights the sector’s divergence between innovation-driven and cost-driven strategies.

Options Playbook: Leveraging Merck’s Bullish Momentum with High-Leverage Calls
• MACD: 1.79 (above signal line 1.03, bullish divergence)
• RSI: 69.37 (overbought but not extreme)
• Bollinger Bands: Price at $97.26 (above upper band $93.75, indicating strong momentum)
• 200-day MA: $83.99 (price at $97.26, 15.8% above, suggesting trend continuation)

Merck’s technicals and fundamentals align for a continuation of the bullish trend. Key support levels at $86.25 (30D) and $84.00 (200D) are far below current levels, reducing near-term downside risk. The 2025-11-28 options chain offers two high-conviction plays:

1. MRK20251128C95
• Contract Code: MRK20251128C95
• Type: Call
• Strike Price: $95
• Expiration: 2025-11-28
• IV Ratio: 35.11% (moderate)
• Leverage Ratio: 28.49% (high)
• Delta: 0.638 (moderate sensitivity)
• Theta: -0.124 (rapid time decay)
• Gamma: 0.063 (high sensitivity to price changes)
• Turnover: 350,784 (liquid)
• Payoff at 5% Upside: $2.36 (max(0, 102.12 - 95))
This call offers a 217% leverage ratio and high gamma, ideal for capitalizing on a potential $102.12 price target (5% above current price). The moderate delta ensures it benefits from both time decay and price movement.

2. MRK20251128C94
• Contract Code: MRK20251128C94
• Type: Call
• Strike Price: $94
• Expiration: 2025-11-28
• IV Ratio: 36.86% (moderate)
• Leverage Ratio: 23.34% (high)
• Delta: 0.693 (moderate sensitivity)
• Theta: -0.123 (rapid time decay)
• Gamma: 0.057 (high sensitivity to price changes)
• Turnover: 23,801 (liquid)
• Payoff at 5% Upside: $8.12 (max(0, 102.12 - 94))
This call provides a 198% leverage ratio and a delta of 0.693, making it a safer bet for a 5% upside scenario. The high gamma ensures it accelerates in value as the stock approaches $94.

Action Plan: Aggressive bulls should prioritize MRK20251128C95 for maximum leverage, while MRK20251128C94 offers a balanced approach. Both contracts benefit from Merck’s strong technicals and the $95 psychological level as a key resistance. If $95 breaks, consider rolling into higher strikes.

Backtest Merck Stock Performance
The requested back-test has been completed. Key implementation details:1. Event definition • Daily close-to-close return ≥ 5 % (intraday surge) 2. Signal logic • Open: at the close of each surge day • Close: after a maximum of 5 trading days (whichever comes first) 3. Universe & horizon • Ticker: MRK (Merck) • Period: 2022-01-03 → 2025-11-18 4. Risk control • Max holding days = 5 (no stop-loss / take-profit specified)Notes on tool execution • The dedicated event-impact engine reported an internal error, so a full “open/hold/close” strategy back-test was run instead. • All default values (e.g. max-holding-days=5) were chosen to give a quick, intuitive picture; let me know if you’d like different settings.Open the interactive report below for performance curves, trade list, and statistics.Please explore the module for detailed equity curves, trade logs and metrics. If you need further tweaks (e.g. alternative exit rules, risk limits, comparison benchmarks), just let me know!

Merck’s Bull Run Gains Legs: Target $102.12 by November 28
Merck’s 4.7% surge is underpinned by a strategic acquisition and clinical progress, positioning it as a top performer in the pharmaceutical sector. The $9.2 billion Cidara deal and Winrevair’s Phase 2 success address both near-term revenue gaps and long-term innovation risks. Technically, the stock is in a short-term bullish trend with RSI at 69.37 and MACD divergence suggesting momentum. Investors should monitor the $95 level as a critical inflection point. Meanwhile, Pfizer (PFE)’s 1.1% gain highlights Merck’s outperformance. For those seeking leverage, the MRK20251128C95 call offers a high-conviction play to capitalize on a potential $102.12 price target. Act now: Buy MRK20251128C95 and MRK20251128C94 to ride the momentum before the November 28 expiration.