MERCK & CO. INC. (MRK) Fundamental Analysis & Valuation

NYSE:MRK • US58933Y1055

Current stock price

114.2 USD
-0.3 (-0.26%)
At close:
114.2 USD
0 (0%)
After Hours:

This MRK fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

9

1. MRK Profitability Analysis

1.1 Basic Checks

  • In the past year MRK was profitable.
  • In the past year MRK had a positive cash flow from operations.
  • Each year in the past 5 years MRK has been profitable.
  • In the past 5 years MRK always reported a positive cash flow from operatings.
MRK Yearly Net Income VS EBIT VS OCF VS FCFMRK Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B 20B 25B

1.2 Ratios

  • MRK's Return On Assets of 13.34% is amongst the best of the industry. MRK outperforms 94.27% of its industry peers.
  • MRK's Return On Equity of 34.70% is amongst the best of the industry. MRK outperforms 95.31% of its industry peers.
  • MRK has a Return On Invested Capital of 19.70%. This is amongst the best in the industry. MRK outperforms 96.88% of its industry peers.
  • MRK had an Average Return On Invested Capital over the past 3 years of 22.50%. This is significantly above the industry average of 12.98%.
Industry RankSector Rank
ROA 13.34%
ROE 34.7%
ROIC 19.7%
ROA(3y)9.43%
ROA(5y)10.79%
ROE(3y)24.21%
ROE(5y)27.67%
ROIC(3y)22.5%
ROIC(5y)20.92%
MRK Yearly ROA, ROE, ROICMRK Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10 20 30

1.3 Margins

  • MRK has a Profit Margin of 28.08%. This is amongst the best in the industry. MRK outperforms 93.75% of its industry peers.
  • MRK's Profit Margin has improved in the last couple of years.
  • MRK's Operating Margin of 38.11% is amongst the best of the industry. MRK outperforms 96.88% of its industry peers.
  • MRK's Operating Margin has improved in the last couple of years.
  • Looking at the Gross Margin, with a value of 78.55%, MRK belongs to the top of the industry, outperforming 84.38% of the companies in the same industry.
  • MRK's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 38.11%
PM (TTM) 28.08%
GM 78.55%
OM growth 3Y6.33%
OM growth 5Y9.38%
PM growth 3Y4.66%
PM growth 5Y10.53%
GM growth 3Y4.72%
GM growth 5Y2.48%
MRK Yearly Profit, Operating, Gross MarginsMRK Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20 40 60 80

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ROAROEROICOperating and Profit MarginShow most profitable peers

6

2. MRK Health Analysis

2.1 Basic Checks

  • MRK has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
  • The number of shares outstanding for MRK has been reduced compared to 1 year ago.
  • The number of shares outstanding for MRK has been reduced compared to 5 years ago.
  • Compared to 1 year ago, MRK has a worse debt to assets ratio.
MRK Yearly Shares OutstandingMRK Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B 2B 2.5B
MRK Yearly Total Debt VS Total AssetsMRK Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20B 40B 60B 80B 100B

2.2 Solvency

  • An Altman-Z score of 3.97 indicates that MRK is not in any danger for bankruptcy at the moment.
  • MRK has a better Altman-Z score (3.97) than 73.44% of its industry peers.
  • MRK has a debt to FCF ratio of 3.99. This is a good value and a sign of high solvency as MRK would need 3.99 years to pay back of all of its debts.
  • The Debt to FCF ratio of MRK (3.99) is better than 85.94% of its industry peers.
  • A Debt/Equity ratio of 0.89 indicates that MRK is somewhat dependend on debt financing.
  • The Debt to Equity ratio of MRK (0.89) is worse than 70.31% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.89
Debt/FCF 3.99
Altman-Z 3.97
ROIC/WACC2.18
WACC9.05%
MRK Yearly LT Debt VS Equity VS FCFMRK Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10B 20B 30B 40B 50B

2.3 Liquidity

  • A Current Ratio of 1.54 indicates that MRK should not have too much problems paying its short term obligations.
  • The Current ratio of MRK (1.54) is worse than 70.31% of its industry peers.
  • MRK has a Quick Ratio of 1.30. This is a normal value and indicates that MRK is financially healthy and should not expect problems in meeting its short term obligations.
  • MRK has a Quick ratio of 1.30. This is in the lower half of the industry: MRK underperforms 68.23% of its industry peers.
Industry RankSector Rank
Current Ratio 1.54
Quick Ratio 1.3
MRK Yearly Current Assets VS Current LiabilitesMRK Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10B 20B 30B 40B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. MRK Growth Analysis

3.1 Past

  • MRK shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 20.16%, which is quite impressive.
  • Measured over the past years, MRK shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.13% on average per year.
  • MRK shows a small growth in Revenue. In the last year, the Revenue has grown by 1.31%.
  • Measured over the past years, MRK shows a quite strong growth in Revenue. The Revenue has been growing by 9.38% on average per year.
EPS 1Y (TTM)20.16%
EPS 3Y7.06%
EPS 5Y9.13%
EPS Q2Q%21.51%
Revenue 1Y (TTM)1.31%
Revenue growth 3Y3.12%
Revenue growth 5Y9.38%
Sales Q2Q%4.97%

3.2 Future

  • MRK is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 2.29% yearly.
  • The Revenue is expected to grow by 2.66% on average over the next years.
EPS Next Y-43.62%
EPS Next 2Y3.58%
EPS Next 3Y6.11%
EPS Next 5Y2.29%
Revenue Next Year3.06%
Revenue Next 2Y4.26%
Revenue Next 3Y5.08%
Revenue Next 5Y2.66%

3.3 Evolution

  • The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
MRK Yearly Revenue VS EstimatesMRK Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 20B 40B 60B
MRK Yearly EPS VS EstimatesMRK Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2 4 6 8 10

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6

4. MRK Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 12.44, which indicates a correct valuation of MRK.
  • MRK's Price/Earnings ratio is rather cheap when compared to the industry. MRK is cheaper than 87.50% of the companies in the same industry.
  • MRK is valuated cheaply when we compare the Price/Earnings ratio to 25.79, which is the current average of the S&P500 Index.
  • The Price/Forward Earnings ratio is 22.07, which indicates a rather expensive current valuation of MRK.
  • Based on the Price/Forward Earnings ratio, MRK is valued a bit cheaper than the industry average as 77.60% of the companies are valued more expensively.
  • MRK's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 23.80.
Industry RankSector Rank
PE 12.44
Fwd PE 22.07
MRK Price Earnings VS Forward Price EarningsMRK Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 10 20 30 40 50

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, MRK is valued cheaply inside the industry as 88.02% of the companies are valued more expensively.
  • Compared to the rest of the industry, the Price/Free Cash Flow ratio of MRK indicates a rather cheap valuation: MRK is cheaper than 83.33% of the companies listed in the same industry.
Industry RankSector Rank
P/FCF 22.84
EV/EBITDA 10.38
MRK Per share dataMRK EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15 20 25

4.3 Compensation for Growth

  • MRK has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.36
EPS Next 2Y3.58%
EPS Next 3Y6.11%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

7

5. MRK Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 2.93%, MRK has a reasonable but not impressive dividend return.
  • MRK's Dividend Yield is rather good when compared to the industry average which is at 0.77. MRK pays more dividend than 93.75% of the companies in the same industry.
  • Compared to an average S&P500 Dividend Yield of 1.91, MRK pays a better dividend.
Industry RankSector Rank
Dividend Yield 2.93%

5.2 History

  • The dividend of MRK has a limited annual growth rate of 5.92%.
  • MRK has paid a dividend for at least 10 years, which is a reliable track record.
  • MRK has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)5.92%
Div Incr Years14
Div Non Decr Years34
MRK Yearly Dividends per shareMRK Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 1 2 3

5.3 Sustainability

  • 44.79% of the earnings are spent on dividend by MRK. This is a bit on the high side, but may be sustainable.
  • MRK's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP44.79%
EPS Next 2Y3.58%
EPS Next 3Y6.11%
MRK Yearly Income VS Free CF VS DividendMRK Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B
MRK Dividend Payout.MRK Dividend Payout, showing the Payout Ratio.MRK Dividend Payout.PayoutRetained Earnings

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MRK Fundamentals: All Metrics, Ratios and Statistics

MERCK & CO. INC.

NYSE:MRK (3/19/2026, 5:21:38 PM)

After market: 114.2 0 (0%)

114.2

-0.3 (-0.26%)

Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)02-03
Earnings (Next)04-30
Inst Owners81.17%
Inst Owner Change-1.36%
Ins Owners0.05%
Ins Owner Change-0.69%
Market Cap282.35B
Revenue(TTM)65.01B
Net Income(TTM)18.25B
Analysts77.78
Price Target128.08 (12.15%)
Short Float %1.27%
Short Ratio2.53
Dividend
Industry RankSector Rank
Dividend Yield 2.93%
Yearly Dividend3.27
Dividend Growth(5Y)5.92%
DP44.79%
Div Incr Years14
Div Non Decr Years34
Ex-Date03-16
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.02%
Min EPS beat(2)2.98%
Max EPS beat(2)13.06%
EPS beat(4)4
Avg EPS beat(4)6.66%
Min EPS beat(4)2.93%
Max EPS beat(4)13.06%
EPS beat(8)8
Avg EPS beat(8)6.19%
EPS beat(12)12
Avg EPS beat(12)16.34%
EPS beat(16)16
Avg EPS beat(16)14.5%
Revenue beat(2)2
Avg Revenue beat(2)0.57%
Min Revenue beat(2)0.31%
Max Revenue beat(2)0.83%
Revenue beat(4)3
Avg Revenue beat(4)0.01%
Min Revenue beat(4)-1.54%
Max Revenue beat(4)0.83%
Revenue beat(8)6
Avg Revenue beat(8)0.46%
Revenue beat(12)9
Avg Revenue beat(12)1.15%
Revenue beat(16)13
Avg Revenue beat(16)1.9%
PT rev (1m)7.99%
PT rev (3m)20.64%
EPS NQ rev (1m)10.02%
EPS NQ rev (3m)-162.26%
EPS NY rev (1m)-4.35%
EPS NY rev (3m)-45.49%
Revenue NQ rev (1m)-0.39%
Revenue NQ rev (3m)-1.02%
Revenue NY rev (1m)-1.22%
Revenue NY rev (3m)-1.8%
Valuation
Industry RankSector Rank
PE 12.44
Fwd PE 22.07
P/S 4.34
P/FCF 22.84
P/OCF 17.14
P/B 5.37
P/tB 64.97
EV/EBITDA 10.38
EPS(TTM)9.18
EY8.04%
EPS(NY)5.18
Fwd EY4.53%
FCF(TTM)5
FCFY4.38%
OCF(TTM)6.66
OCFY5.83%
SpS26.29
BVpS21.28
TBVpS1.76
PEG (NY)N/A
PEG (5Y)1.36
Graham Number66.29
Profitability
Industry RankSector Rank
ROA 13.34%
ROE 34.7%
ROCE 22.83%
ROIC 19.7%
ROICexc 22.75%
ROICexgc 46.78%
OM 38.11%
PM (TTM) 28.08%
GM 78.55%
FCFM 19.01%
ROA(3y)9.43%
ROA(5y)10.79%
ROE(3y)24.21%
ROE(5y)27.67%
ROIC(3y)22.5%
ROIC(5y)20.92%
ROICexc(3y)25.76%
ROICexc(5y)23.99%
ROICexgc(3y)53.32%
ROICexgc(5y)52.7%
ROCE(3y)26.06%
ROCE(5y)24.23%
ROICexgc growth 3Y-4.44%
ROICexgc growth 5Y2.75%
ROICexc growth 3Y0.21%
ROICexc growth 5Y7.95%
OM growth 3Y6.33%
OM growth 5Y9.38%
PM growth 3Y4.66%
PM growth 5Y10.53%
GM growth 3Y4.72%
GM growth 5Y2.48%
F-Score5
Asset Turnover0.47
Health
Industry RankSector Rank
Debt/Equity 0.89
Debt/FCF 3.99
Debt/EBITDA 1.53
Cap/Depr 70.44%
Cap/Sales 6.33%
Interest Coverage 19.06
Cash Conversion 53.81%
Profit Quality 67.71%
Current Ratio 1.54
Quick Ratio 1.3
Altman-Z 3.97
F-Score5
WACC9.05%
ROIC/WACC2.18
Cap/Depr(3y)81.72%
Cap/Depr(5y)99.16%
Cap/Sales(3y)6%
Cap/Sales(5y)6.91%
Profit Quality(3y)892.79%
Profit Quality(5y)570.74%
High Growth Momentum
Growth
EPS 1Y (TTM)20.16%
EPS 3Y7.06%
EPS 5Y9.13%
EPS Q2Q%21.51%
EPS Next Y-43.62%
EPS Next 2Y3.58%
EPS Next 3Y6.11%
EPS Next 5Y2.29%
Revenue 1Y (TTM)1.31%
Revenue growth 3Y3.12%
Revenue growth 5Y9.38%
Sales Q2Q%4.97%
Revenue Next Year3.06%
Revenue Next 2Y4.26%
Revenue Next 3Y5.08%
Revenue Next 5Y2.66%
EBIT growth 1Y1.98%
EBIT growth 3Y9.65%
EBIT growth 5Y19.64%
EBIT Next Year-19.93%
EBIT Next 3Y10.24%
EBIT Next 5Y4.83%
FCF growth 1Y-31.7%
FCF growth 3Y-5.63%
FCF growth 5Y16.24%
OCF growth 1Y-23.27%
OCF growth 3Y-4.81%
OCF growth 5Y9.95%

MERCK & CO. INC. / MRK Fundamental Analysis FAQ

What is the fundamental rating for MRK stock?

ChartMill assigns a fundamental rating of 7 / 10 to MRK.


Can you provide the valuation status for MERCK & CO. INC.?

ChartMill assigns a valuation rating of 6 / 10 to MERCK & CO. INC. (MRK). This can be considered as Fairly Valued.


Can you provide the profitability details for MERCK & CO. INC.?

MERCK & CO. INC. (MRK) has a profitability rating of 9 / 10.


What is the financial health of MERCK & CO. INC. (MRK) stock?

The financial health rating of MERCK & CO. INC. (MRK) is 6 / 10.


How sustainable is the dividend of MERCK & CO. INC. (MRK) stock?

The dividend rating of MERCK & CO. INC. (MRK) is 7 / 10 and the dividend payout ratio is 44.79%.