MERCK & CO. INC. (MRK) Stock Fundamental Analysis
NYSE:MRK • US58933Y1055
123.93 USD
+0.11 (+0.09%)
At close: Feb 24, 2026
124.06 USD
+0.13 (+0.1%)
After Hours: 2/24/2026, 8:04:00 PM
We assign a fundamental rating of 6 out of 10 to MRK. MRK was compared to 192 industry peers in the Pharmaceuticals industry. While MRK belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. MRK has a correct valuation and a medium growth rate. Finally MRK also has an excellent dividend rating. This makes MRK very considerable for dividend investing!
1. Profitability
1.1 Basic Checks
- In the past year MRK was profitable.
- In the past year MRK had a positive cash flow from operations.
- In the past 5 years MRK has always been profitable.
- Of the past 5 years MRK 4 years had a positive operating cash flow.
1.2 Ratios
- The Return On Assets of MRK (14.69%) is better than 94.79% of its industry peers.
- MRK has a Return On Equity of 36.71%. This is amongst the best in the industry. MRK outperforms 95.31% of its industry peers.
- MRK's Return On Invested Capital of 20.32% is amongst the best of the industry. MRK outperforms 96.88% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.69% | ||
| ROE | 36.71% | ||
| ROIC | 20.32% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
- With an excellent Profit Margin value of 29.63%, MRK belongs to the best of the industry, outperforming 94.27% of the companies in the same industry.
- In the last couple of years the Profit Margin of MRK has grown nicely.
- The Operating Margin of MRK (36.99%) is better than 96.35% of its industry peers.
- In the last couple of years the Operating Margin of MRK has grown nicely.
- With an excellent Gross Margin value of 77.69%, MRK belongs to the best of the industry, outperforming 83.85% of the companies in the same industry.
- MRK's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.99% | ||
| PM (TTM) | 29.63% | ||
| GM | 77.69% |
OM growth 3Y6.33%
OM growth 5Y9.38%
PM growth 3Y4.66%
PM growth 5Y10.53%
GM growth 3Y4.72%
GM growth 5Y2.48%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), MRK is creating value.
- MRK has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
- An Altman-Z score of 4.43 indicates that MRK is not in any danger for bankruptcy at the moment.
- With a decent Altman-Z score value of 4.43, MRK is doing good in the industry, outperforming 73.44% of the companies in the same industry.
- MRK has a debt to FCF ratio of 3.17. This is a good value and a sign of high solvency as MRK would need 3.17 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 3.17, MRK belongs to the top of the industry, outperforming 89.58% of the companies in the same industry.
- MRK has a Debt/Equity ratio of 0.77. This is a neutral value indicating MRK is somewhat dependend on debt financing.
- With a Debt to Equity ratio value of 0.77, MRK is not doing good in the industry: 68.75% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 3.17 | ||
| Altman-Z | 4.43 |
ROIC/WACC2.25
WACC9.04%
2.3 Liquidity
- MRK has a Current Ratio of 1.66. 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 worse Current ratio (1.66) than 66.67% of its industry peers.
- MRK has a Quick Ratio of 1.44. 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 worse Quick ratio (1.44) than 63.54% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.44 |
3. Growth
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.
- The Revenue has been growing slightly by 1.31% in the past year.
- 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
- Based on estimates for the next years, MRK will show a small growth in Earnings Per Share. The EPS will grow by 1.63% on average per year.
- The Revenue is expected to grow by 2.49% on average over the next years.
EPS Next Y-41.06%
EPS Next 2Y4.38%
EPS Next 3Y5.65%
EPS Next 5Y1.63%
Revenue Next Year2.98%
Revenue Next 2Y4.12%
Revenue Next 3Y4.9%
Revenue Next 5Y2.49%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 13.50, MRK is valued correctly.
- Compared to the rest of the industry, the Price/Earnings ratio of MRK indicates a rather cheap valuation: MRK is cheaper than 88.54% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 26.98, MRK is valued a bit cheaper.
- Based on the Price/Forward Earnings ratio of 22.90, the valuation of MRK can be described as rather expensive.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of MRK indicates a somewhat cheap valuation: MRK is cheaper than 76.04% of the companies listed in the same industry.
- When comparing the Price/Forward Earnings ratio of MRK to the average of the S&P500 Index (28.01), we can say MRK is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.5 | ||
| Fwd PE | 22.9 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MRK indicates a rather cheap valuation: MRK is cheaper than 86.98% of the companies listed in the same industry.
- MRK's Price/Free Cash Flow ratio is rather cheap when compared to the industry. MRK is cheaper than 83.85% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.57 | ||
| EV/EBITDA | 11.66 |
4.3 Compensation for Growth
- The excellent profitability rating of MRK may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.48
EPS Next 2Y4.38%
EPS Next 3Y5.65%
5. Dividend
5.1 Amount
- MRK has a Yearly Dividend Yield of 2.79%.
- MRK's Dividend Yield is rather good when compared to the industry average which is at 1.07. MRK pays more dividend than 93.75% of the companies in the same industry.
- MRK's Dividend Yield is rather good when compared to the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.79% |
5.2 History
- On average, the dividend of MRK grows each year by 6.90%, which is quite nice.
- MRK has paid a dividend for at least 10 years, which is a reliable track record.
- MRK has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)6.9%
Div Incr Years14
Div Non Decr Years34
5.3 Sustainability
- 42.60% 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.
DP42.6%
EPS Next 2Y4.38%
EPS Next 3Y5.65%
123.93
+0.11 (+0.09%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)02-03 2026-02-03/bmo
Earnings (Next)04-30 2026-04-30
Inst Owners80.32%
Inst Owner Change-1.74%
Ins Owners0.05%
Ins Owner Change-0.69%
Market Cap307.60B
Revenue(TTM)65.01B
Net Income(TTM)19.03B
Analysts77.06
Price Target118.61 (-4.29%)
Short Float %1.16%
Short Ratio2.05
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.79% |
Yearly Dividend3.1
Dividend Growth(5Y)6.9%
DP42.6%
Div Incr Years14
Div Non Decr Years34
Ex-Date03-16 2026-03-16 (0.85)
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.37%
Min EPS beat(2)7.69%
Max EPS beat(2)13.06%
EPS beat(4)4
Avg EPS beat(4)7.28%
Min EPS beat(4)2.93%
Max EPS beat(4)13.06%
EPS beat(8)8
Avg EPS beat(8)21.72%
EPS beat(12)12
Avg EPS beat(12)16.45%
EPS beat(16)16
Avg EPS beat(16)15.36%
Revenue beat(2)1
Avg Revenue beat(2)-0.35%
Min Revenue beat(2)-1.54%
Max Revenue beat(2)0.83%
Revenue beat(4)2
Avg Revenue beat(4)-0.09%
Min Revenue beat(4)-1.54%
Max Revenue beat(4)0.83%
Revenue beat(8)5
Avg Revenue beat(8)0.41%
Revenue beat(12)9
Avg Revenue beat(12)1.14%
Revenue beat(16)13
Avg Revenue beat(16)1.98%
PT rev (1m)4.23%
PT rev (3m)15.92%
EPS NQ rev (1m)-0.27%
EPS NQ rev (3m)-2.31%
EPS NY rev (1m)-5.38%
EPS NY rev (3m)-43.18%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)0.05%
Revenue NY rev (1m)-1.42%
Revenue NY rev (3m)-1.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.5 | ||
| Fwd PE | 22.9 | ||
| P/S | 4.79 | ||
| P/FCF | 23.57 | ||
| P/OCF | 18.03 | ||
| P/B | 5.93 | ||
| P/tB | 20.58 | ||
| EV/EBITDA | 11.66 |
EPS(TTM)9.18
EY7.41%
EPS(NY)5.41
Fwd EY4.37%
FCF(TTM)5.26
FCFY4.24%
OCF(TTM)6.88
OCFY5.55%
SpS25.88
BVpS20.89
TBVpS6.02
PEG (NY)N/A
PEG (5Y)1.48
Graham Number65.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.69% | ||
| ROE | 36.71% | ||
| ROCE | 23.54% | ||
| ROIC | 20.32% | ||
| ROICexc | 24.8% | ||
| ROICexgc | 44.78% | ||
| OM | 36.99% | ||
| PM (TTM) | 29.63% | ||
| GM | 77.69% | ||
| FCFM | 20.31% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
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-Score6
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 3.17 | ||
| Debt/EBITDA | 1.41 | ||
| Cap/Depr | 87.9% | ||
| Cap/Sales | 6.25% | ||
| Interest Coverage | 17.91 | ||
| Cash Conversion | 60.24% | ||
| Profit Quality | 68.56% | ||
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.44 | ||
| Altman-Z | 4.43 |
F-Score6
WACC9.04%
ROIC/WACC2.25
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)20.16%
EPS 3Y7.06%
EPS 5Y9.13%
EPS Q2Q%21.51%
EPS Next Y-41.06%
EPS Next 2Y4.38%
EPS Next 3Y5.65%
EPS Next 5Y1.63%
Revenue 1Y (TTM)1.31%
Revenue growth 3Y3.12%
Revenue growth 5Y9.38%
Sales Q2Q%4.97%
Revenue Next Year2.98%
Revenue Next 2Y4.12%
Revenue Next 3Y4.9%
Revenue Next 5Y2.49%
EBIT growth 1Y-0.15%
EBIT growth 3Y9.65%
EBIT growth 5Y19.64%
EBIT Next Year-15.41%
EBIT Next 3Y12.42%
EBIT Next 5Y2.91%
FCF growth 1Y-12.07%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-6.56%
OCF growth 3YN/A
OCF growth 5YN/A
MERCK & CO. INC. / MRK FAQ
What is the fundamental rating for MRK stock?
ChartMill assigns a fundamental rating of 6 / 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 8 / 10.
What is the financial health of MERCK & CO. INC. (MRK) stock?
The financial health rating of MERCK & CO. INC. (MRK) is 5 / 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 42.6%.