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

NYSE:MRK • US58933Y1055

117.11 USD
+1.32 (+1.14%)
At close: Mar 9, 2026
117.25 USD
+0.14 (+0.12%)
Pre-Market: 3/10/2026, 5:00:08 AM
Overview Stock Chart Technical Analysis Fundamental Analysis Forecast Earnings Financials Ownership News

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

Fundamental Rating

7

MRK gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 193 industry peers in the Pharmaceuticals industry. MRK has an excellent profitability rating, but there are some minor concerns on its financial health. MRK has a decent growth rate and is not valued too expensively. MRK also has an excellent dividend rating. This makes MRK very considerable for dividend investing!


Dividend Valuation Growth Profitability Health

9

1. MRK Profitability Analysis

1.1 Basic Checks

  • MRK had positive earnings in the past year.
  • MRK had a positive operating cash flow in the past year.
  • In the past 5 years MRK has always 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 has a Return On Assets of 13.34%. This is amongst the best in the industry. MRK outperforms 94.30% of its industry peers.
  • MRK has a Return On Equity of 34.70%. This is amongst the best in the industry. MRK outperforms 95.34% of its industry peers.
  • The Return On Invested Capital of MRK (19.70%) is better than 96.89% 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 13.09%.
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 93.26% of its industry peers.
  • MRK's Profit Margin has improved in the last couple of years.
  • MRK has a Operating Margin of 38.11%. This is amongst the best in the industry. MRK outperforms 96.37% of its industry peers.
  • MRK's Operating Margin has improved in the last couple of years.
  • The Gross Margin of MRK (78.55%) is better than 83.94% of its industry peers.
  • In the last couple of years the Gross Margin of MRK has grown nicely.
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

  • With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), MRK is creating value.
  • MRK has less shares outstanding than it did 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

  • MRK has an Altman-Z score of 4.01. This indicates that MRK is financially healthy and has little risk of bankruptcy at the moment.
  • MRK has a better Altman-Z score (4.01) than 71.50% of its industry peers.
  • The Debt to FCF ratio of MRK is 3.99, which is a good value as it means it would take MRK, 3.99 years of fcf income to pay off all of its debts.
  • MRK has a Debt to FCF ratio of 3.99. This is amongst the best in the industry. MRK outperforms 86.01% of its industry peers.
  • MRK has a Debt/Equity ratio of 0.89. This is a neutral value indicating MRK is somewhat dependend on debt financing.
  • MRK has a worse Debt to Equity ratio (0.89) than 69.95% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.89
Debt/FCF 3.99
Altman-Z 4.01
ROIC/WACC2.17
WACC9.08%
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 69.43% 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.
  • The Quick ratio of MRK (1.30) is worse than 67.88% 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

  • 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.
  • 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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Find the best growth stocksShow best growing peers

6

4. MRK Valuation Analysis

4.1 Price/Earnings Ratio

  • MRK is valuated correctly with a Price/Earnings ratio of 12.76.
  • Based on the Price/Earnings ratio, MRK is valued cheaper than 87.56% of the companies in the same industry.
  • MRK is valuated cheaply when we compare the Price/Earnings ratio to 26.46, which is the current average of the S&P500 Index.
  • Based on the Price/Forward Earnings ratio of 22.63, the valuation of MRK can be described as rather expensive.
  • MRK's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. MRK is cheaper than 78.24% of the companies in the same industry.
  • MRK is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 24.65, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 12.76
Fwd PE 22.63
MRK Price Earnings VS Forward Price EarningsMRK Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • Based on the Enterprise Value to EBITDA ratio, MRK is valued cheaper than 88.08% of the companies in the same industry.
  • 83.42% of the companies in the same industry are more expensive than MRK, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 23.43
EV/EBITDA 10.59
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

  • The excellent profitability rating of MRK may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.4
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

  • MRK has a Yearly Dividend Yield of 2.93%.
  • Compared to an average industry Dividend Yield of 0.70, MRK pays a better dividend. On top of this MRK pays more dividend than 93.78% 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 1.82.
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 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)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

More info and screens

Find the best dividend stocksShow peers with best dividend

MRK Fundamentals: All Metrics, Ratios and Statistics

MERCK & CO. INC.

NYSE:MRK (3/9/2026, 8:23:28 PM)

Premarket: 117.25 +0.14 (+0.12%)

117.11

+1.32 (+1.14%)

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-1.41%
Ins Owners0.05%
Ins Owner Change-0.69%
Market Cap289.54B
Revenue(TTM)65.01B
Net Income(TTM)18.25B
Analysts77.78
Price Target128.08 (9.37%)
Short Float %1.13%
Short Ratio2.13
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)-4.58%
EPS NQ rev (3m)-162.31%
EPS NY rev (1m)-4.35%
EPS NY rev (3m)-45.49%
Revenue NQ rev (1m)-2.68%
Revenue NQ rev (3m)-1.02%
Revenue NY rev (1m)-1.22%
Revenue NY rev (3m)-1.8%
Valuation
Industry RankSector Rank
PE 12.76
Fwd PE 22.63
P/S 4.45
P/FCF 23.43
P/OCF 17.58
P/B 5.5
P/tB 66.62
EV/EBITDA 10.59
EPS(TTM)9.18
EY7.84%
EPS(NY)5.18
Fwd EY4.42%
FCF(TTM)5
FCFY4.27%
OCF(TTM)6.66
OCFY5.69%
SpS26.29
BVpS21.28
TBVpS1.76
PEG (NY)N/A
PEG (5Y)1.4
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 4.01
F-Score5
WACC9.08%
ROIC/WACC2.17
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 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%.