Are Merck & Co., Inc. and Novartis AG (ADR) a Match Made in Health Care Heaven?

Novartis is considering divesting its animal health business, but could a swap for Merck's consumer unit be the best option for this big pharma firm?

Jan 10, 2014 at 6:30PM

Consolidation's been the name of the game around big pharma recently. Pfizer's (NYSE:PFE) made a name spinning off or selling its non-core businesses, selling its infant formula unit for nearly $12 billion back in 2012 and spinning off its animal health business into Zoetis (NYSE:ZTS) last year. It's been a strategy that has many investors thirsting for more from other top names around big pharma, and Novartis (NYSE:NVS), one of the best in the business, is considering its own take on the divestment strategy.

Novartis is looking at potentially selling or otherwise dealing its animal health business to interested suitors. Merck's (NYSE:MRK) one such company that's sniffing around to add to its own formidable animal health group. While the two companies could hash out a sale, Novartis has been rumored to be exploring another possibility. According to a report from Bloomberg, Novartis is considering swapping its animal health business for Merck's over-the-counter unit, home to several top brands such as Coppertone and Claritin.

Is this rumored deal the best bet for Novartis and Merck investors? In the video below, Motley Fool contributor Dan Carroll talks about how this trade could be a great option for both companies -- and what investors should be on the lookout for from both Novartis and Merck going forward.

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Fool contributor Dan Carroll has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 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.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't 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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