Revolution Medicines Stock Stares At Big Dip After Merck Reportedly Shelves Buyout — But Analyst Flags Opportunity

• A Wall Street Journal report said there was a possibility of talks restarting between Merck and Revolution Medicines, or that another suitor would emerge.
• The stock has gained nearly 15% since Jan. 7, when reports surfaced that AbbVie was eyeing the cancer drug developer.
• Stifel said that it would be surprised to see the stock settle meaningfully below $100 per share.

Shares of Revolution Medicines were down nearly 20% in overnight trading after media reports emerged that Merck was no longer in talks to acquire the cancer drug developer, as the two parties could not reach an agreement on price. But a Wall Street analyst expects investors to scoop up any dip.

A Wall Street Journal report noted that the talks could restart or that another suitor for Revolution Medicines could emerge. The Journal reported a couple of weeks back that Merck and Revolution were in merger talks in a deal that valued the latter at around $30 billion, and could come as soon as later this month.

The stock had gained nearly 15% since Jan. 7, when reports surfaced that AbbVie was eyeing the cancer drug developer. AbbVie later said it was not in any discussions with the company. 

Shares of Revolution Medicines are trading overnight at $94.96, according to Yahoo Finance, and are set for their worst day since October 2023, if losses hold during Monday’s session.

Stifel Expects Buying The Dip

Following reports that Merck shelved talks with Revolution, Stifel said it expects buyers of RVMD to step in on weakness and added that it would be surprised to see the stock settle meaningfully below $100 per share.

This "M&A clearing event will be viewed as a buying opportunity for many sector specialists," said Stifel, adding that the firm expects investor focus to shift now to Revolution's "catalyst-rich" 2026.

Wall Street had noted earlier that Merck’s deal with Revolution Medicines would give it access to its experimental drug daraxonrasib. The drug has won a fast-track review voucher from the U.S. Food and Drug Administration and is in the late-stage trials.

Daraxonrasib targets multiple mutations in the RAS genes, which are found in major cancers, including lung and pancreatic cancers.

How Are Stocktwits Users Reacting?

Retail sentiment on Revolution Medicines in the ‘bullish’ territory compared to ‘bearish’ a day ago, with message volumes at ‘normal’ levels, according to data from Stocktwits.

In the last 24 hours, the retail message volumes on the stock jumped 666% on Stocktwits, and there was a nearly 2% spike in followers on the platform.

Shares of Revolution Medicines jumped 188% in the last 12 months.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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