Merck & Co., Inc. (MRK) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

+19.4%

$177.18

vs $148.43 price

Levered DCF

$106.10

After debt service

Piotroski score

6 / 9

Average

Altman Z-score

3.99

Safe zone

Rating

C-

Overall 1 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	14.42×	14.72×	778.71×	19.36×	14.85×	27.96×	22.58×	30.36×
P/B	5.01×	5.44×	7.39×	6.11×	5.08×	7.79×	8.59×	7.07×
P/S	4.06×	3.93×	4.62×	4.74×	3.98×	4.75×	5.69×	4.47×
EV / EBITDA	10.59×	10.77×	44.46×	14.08×	12.32×	21.88×	15×	14.73×
Gross margin	72.0%	76.3%	73.2%	70.6%	72.0%	67.2%	69.3%	68.1%
Operating margin	36.2%	31.5%	4.9%	30.8%	27.1%	13.4%	20.3%	21.1%
Net margin	28.1%	26.7%	0.6%	24.5%	26.8%	17.0%	25.2%	14.7%
Current ratio	1.54×	1.36×	1.25×	1.47×	1.27×	1.02×	1.24×	1.17×
Debt / equity	0.96×	0.83×	0.97×	0.7×	0.91×	1.32×	1.06×	0.94×
Interest coverage	17.31×	15.91×	2.58×	19×	16.38×	6.68×	8.88×	11.57×
Dividend yield	3.1%	3.1%	2.7%	2.5%	3.4%	3.1%	2.6%	2.7%
Payout ratio	44.8%	45.8%	2039.7%	48.3%	50.7%	87.9%	57.9%	83.2%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	34.7%	37.0%	1.0%	31.6%	34.2%	27.9%	38.0%	23.3%
Return on invested capital	18.3%	19.0%	0.7%	18.5%	13.9%	6.0%	9.4%	9.7%
Return on assets	13.3%	14.6%	0.3%	13.3%	12.3%	7.7%	11.7%	7.5%
Free cash flow yield	4.7%	7.2%	3.3%	5.2%	5.0%	3.0%	4.5%	4.4%
Earnings yield	6.9%	6.8%	0.1%	5.2%	6.7%	3.6%	4.4%	3.3%
Enterprise value	$299.3B	$276.9B	$307.1B	$300.2B	$220.4B	$222.7B	$240.1B	$206B
Net debt / EBITDA	1.27×	0.97×	4.26×	0.91×	1.48×	2.49×	1.1×	1.23×
Cash conversion cycle (days)	116	107	118	93	105	93	131	118