MERCK & CO. INC. (MRK) Stock Fundamental Analysis
NYSE:MRK • US58933Y1055
121.46 USD
-0.2 (-0.16%)
Last: Feb 19, 2026, 12:52 PM
Overall MRK gets a fundamental rating of 6 out of 10. We evaluated MRK against 191 industry peers in the Pharmaceuticals industry. While MRK has a great profitability rating, there are some minor concerns on its financial health. MRK is not valued too expensively and it also shows a decent growth rate. Finally MRK also has an excellent dividend rating. These ratings would make MRK suitable for dividend investing!
1. Profitability
1.1 Basic Checks
- MRK had positive earnings in the past year.
- MRK had a positive operating cash flow in the past year.
- Each year in the past 5 years MRK has been profitable.
- Of the past 5 years MRK 4 years had a positive operating cash flow.
1.2 Ratios
- MRK's Return On Assets of 14.69% is amongst the best of the industry. MRK outperforms 94.76% of its industry peers.
- With an excellent Return On Equity value of 36.71%, MRK belongs to the best of the industry, outperforming 95.81% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 20.32%, MRK belongs to the top of the industry, outperforming 96.86% of the companies in the same industry.
| 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 94.24% of the companies in the same industry.
- MRK's Profit Margin has improved in the last couple of years.
- MRK has a Operating Margin of 36.99%. This is amongst the best in the industry. MRK outperforms 96.34% of its industry peers.
- MRK's Operating Margin has improved in the last couple of years.
- MRK's Gross Margin of 77.69% is amongst the best of the industry. MRK outperforms 83.25% of its industry peers.
- In the last couple of years the Gross Margin of MRK has grown nicely.
| 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.
- There is no outstanding debt for MRK. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
- MRK has an Altman-Z score of 4.39. This indicates that MRK is financially healthy and has little risk of bankruptcy at the moment.
- MRK has a Altman-Z score of 4.39. This is in the better half of the industry: MRK outperforms 73.30% of its industry peers.
- 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.
- With an excellent Debt to FCF ratio value of 3.17, MRK belongs to the best of the industry, outperforming 89.01% of the companies in the same industry.
- A Debt/Equity ratio of 0.77 indicates that MRK is somewhat dependend on debt financing.
- MRK has a worse Debt to Equity ratio (0.77) than 69.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 3.17 | ||
| Altman-Z | 4.39 |
ROIC/WACC2.24
WACC9.06%
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 Current ratio of 1.66. This is in the lower half of the industry: MRK underperforms 67.54% of its industry peers.
- A Quick Ratio of 1.44 indicates that MRK should not have too much problems paying its short term obligations.
- With a Quick ratio value of 1.44, MRK is not doing good in the industry: 64.40% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.44 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 20.16% over the past year.
- MRK shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.13% yearly.
- Looking at the last year, MRK shows a small growth in Revenue. The Revenue has grown by 1.31% in the last year.
- MRK shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.38% yearly.
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 Year4.34%
Revenue Next 2Y4.82%
Revenue Next 3Y4.55%
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
- The Price/Earnings ratio is 13.23, which indicates a correct valuation of MRK.
- MRK's Price/Earnings ratio is rather cheap when compared to the industry. MRK is cheaper than 89.01% of the companies in the same industry.
- MRK is valuated cheaply when we compare the Price/Earnings ratio to 27.27, which is the current average of the S&P500 Index.
- MRK is valuated rather expensively with a Price/Forward Earnings ratio of 22.45.
- MRK's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. MRK is cheaper than 75.92% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 28.16, MRK is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.23 | ||
| Fwd PE | 22.45 |
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 86.91% of the companies listed in the same industry.
- Based on the Price/Free Cash Flow ratio, MRK is valued cheaply inside the industry as 84.29% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.1 | ||
| EV/EBITDA | 11.47 |
4.3 Compensation for Growth
- The excellent profitability rating of MRK may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.45
EPS Next 2Y4.38%
EPS Next 3Y5.65%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.85%, MRK has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 1.18, MRK pays a better dividend. On top of this MRK pays more dividend than 93.72% of the companies listed in the same industry.
- MRK's Dividend Yield is rather good when compared to the S&P500 average which is at 1.85.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.85% |
5.2 History
- On average, the dividend of MRK grows each year by 6.90%, which is quite nice.
- MRK has been paying a dividend for at least 10 years, so it has 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.
- The dividend of MRK is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP42.6%
EPS Next 2Y4.38%
EPS Next 3Y5.65%
NYSE:MRK (2/19/2026, 12:52:53 PM)
121.46
-0.2 (-0.16%)
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-3.69%
Ins Owners0.05%
Ins Owner Change-0.69%
Market Cap301.47B
Revenue(TTM)65.01B
Net Income(TTM)19.03B
Analysts77.06
Price Target118.61 (-2.35%)
Short Float %1.16%
Short Ratio2.05
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.85% |
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)7.46%
PT rev (3m)17.4%
EPS NQ rev (1m)-1.66%
EPS NQ rev (3m)-1.81%
EPS NY rev (1m)-41.43%
EPS NY rev (3m)-43.18%
Revenue NQ rev (1m)-0.02%
Revenue NQ rev (3m)-0.07%
Revenue NY rev (1m)-0.35%
Revenue NY rev (3m)-0.57%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.23 | ||
| Fwd PE | 22.45 | ||
| P/S | 4.69 | ||
| P/FCF | 23.1 | ||
| P/OCF | 17.67 | ||
| P/B | 5.81 | ||
| P/tB | 20.16 | ||
| EV/EBITDA | 11.47 |
EPS(TTM)9.18
EY7.56%
EPS(NY)5.41
Fwd EY4.45%
FCF(TTM)5.26
FCFY4.33%
OCF(TTM)6.88
OCFY5.66%
SpS25.88
BVpS20.89
TBVpS6.02
PEG (NY)N/A
PEG (5Y)1.45
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 | 4.39 |
F-Score6
WACC9.06%
ROIC/WACC2.24
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 Year4.34%
Revenue Next 2Y4.82%
Revenue Next 3Y4.55%
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%.