NYSE: MRK · General Drug Manufacturers
Merck (MRK) fair value: undervalued or overvalued?
As of 3 Oct 2026, Faircurve's model values Merck (MRK) at $121.57 a share. The stock last closed at $144.30, which puts the model's fair value 15.8% below the price. On the model's bands that reads as Overvalued.
Revalued . Price is the close of 2 Oct 2026. Merck & Co., Inc.
Faircurve Insights · 3 Oct 2026
Merck & Co., Inc. is a global healthcare leader with operations spanning Pharmaceuticals and Animal Health. The Pharmaceutical segment offers medicinal products for human health.
Faircurve's model found a fair value of $121.57 a share on 3 Oct 2026, the midpoint of 2,000 simulations. The previous run on 26 Sep 2026 gave $125.75, moving the fair value -3.3%. The calibrated range over 63 trading days is $131.71 to $167.85, which held the price 60% of the time at this horizon. The model's evidence grade is Medium.
The company's overall quality score is 38 out of 100 against comparable companies. Its earnings quality score is 100, with FCF / net income 5.06x against a peer median of 1.17x. Profitability scores 5 (ROIC 8.1%, peer median 19.2%), growth quality 43 (Revenue growth, trailing 1.2%, peer median 6.0%), capital discipline 33 (Net buybacks / market value 0.1%, peer median 0.2%), balance sheet 35 (Net debt / EBITDA 3.40x, peer median 1.21x), and stability 11 (EBITDA margin downside volatility, 5y 9.9 pts, peer median 5.5 pts). The model compares it with AbbVie Inc., Amgen Inc., Johnson & Johnson, Gilead Sciences, Inc., Pfizer Inc., Bristol-Myers Squibb Company, Eli Lilly and Company, and Biogen Inc. Moves around the last 8 earnings reports had a median size, ignoring direction, of 2.8%.
Written from the figures on this page for the 3 Oct 2026 valuation and checked by rule before publishing: every number is one printed here, no forecast, no instruction. The price, the gap and the verdict are the page's own and change daily. Not a recommendation.
What price range does the model give MRK?
The calibrated range for MRK over 63 trading days is $131.71 to $167.85. It sits around the last close, and its width comes from the volatility that MRK's own options imply (34% a year), calibrated weekly against realised prices (n = 3,562 past valuations, refreshed 3 Oct 2026). Ranges built this way held the price 60% of the time at this horizon. The fair value is the model's opinion and rides beside the range. It is not the centre of it.
The model's own simulated range, from the 20th to the 80th percentile of its runs, is $84.84 to $169.25. In 33% of the simulations the fair value came out above the price the model ran on.
How does MRK score on business quality?
Merck's overall quality score is 38 out of 100. Each factor below is a score against comparable companies, not a percentile of the metric beside it.
| Factor | Score (0 to 100) | Headline measure | Peer median |
|---|---|---|---|
| ProfitabilityReturn on invested capital against the peer group, with a bonus for an improving trend. | 5 | 8.1%ROIC | 19.2% |
| Earnings qualityHow much of reported profit is cash: free cash flow to net income, and the accrual ratio (the share of earnings that is not cash). | 100 | 5.06xFCF / net income | 1.17x |
| Growth qualityTrailing revenue growth, forward growth from consensus, and the direction of analyst estimate revisions. | 43 | 1.2%Revenue growth, trailing | 6.0% |
| Capital disciplineReinvestment efficiency (capital spending per unit of revenue) and net buybacks. | 33 | 0.1%Net buybacks / market value | 0.2% |
| Balance sheetNet debt to EBITDA and interest coverage. | 35 | 3.40xNet debt / EBITDA | 1.21x |
| StabilityDownside volatility of the EBITDA margin over the last five years. | 11 | 9.9 ptsEBITDA margin downside volatility, 5y | 5.5 pts |
How does MRK compare with similar companies?
The companies in general drug manufacturers closest to Merck in market value, each on the same model and the same date.
| Company | Last close | Model fair value | Gap | Model verdict |
|---|---|---|---|---|
| ABBV AbbVie Inc. | $262.82 | $273.02 | +3.9% | Fairly valued |
| AMGN Amgen Inc. | $403.04 | $429.46 | +6.6% | Fairly valued |
| JNJ Johnson & Johnson | $256.03 | $203.86 | -20.4% | Overvalued |
| GILD Gilead Sciences, Inc. | $144.74 | $136.96 | -5.4% | Fairly valued |
| PFE Pfizer Inc. | $27.80 | $30.43 | +9.5% | Fairly valued |
| BMY Bristol-Myers Squibb Company | $61.15 | $69.89 | +14.3% | Fairly valued |
| LLY Eli Lilly and Company | $1,142.85 | $917.21 | -19.7% | Overvalued |
| BIIB Biogen Inc. | $219.88 | $226.34 | +2.9% | Fairly valued |
All general drug manufacturer stocks ranked by gap to fair value
When does MRK report earnings, and how has the stock reacted?
Merck's next earnings report is scheduled for 29 Oct 2026. Companies can move their dates.
Options prices on 2 Oct 2026 imply a move of about 3.9% in either direction through the nearest expiry, about 13 days out. That is the size the market is pricing, not a direction. MRK's 30 day implied volatility works out to about 9.9% over one month.
How MRK moved around its last 8 earnings reports
Each move runs from the last close before the report to the first close after it, so it covers companies that report before the open and after the close. The median size across these 8 reports, ignoring direction, was 2.8%.
| Report date | Two session move |
|---|---|
| 4 Aug 2026 | +0.5% |
| 30 Apr 2026 | +1.1% |
| 3 Feb 2026 | +4.4% |
| 30 Oct 2025 | -0.7% |
| 29 Jul 2025 | -2.7% |
| 24 Apr 2025 | +5.1% |
| 4 Feb 2025 | -10.1% |
| 31 Oct 2024 | -2.8% |
Merck at a glance
Merck & Co., Inc. is a global healthcare leader with operations spanning two core divisions: Pharmaceuticals and Animal Health. The Pharmaceutical segment is dedicated to human health, offering a broad spectrum of medicinal products.
- Market value
- $356.4B
- Sector
- Healthcare
- Industry
- General Drug Manufacturers
- Revenue expected, next twelve months
- $69.4B
- Consensus revenue growth, next fiscal year
- +3.4%
- Analysts with estimates
- 14
- Beta to the US market
- 0.04
- First valued by Faircurve
- 1 May 2026
How the fair value is worked out: the model prices Merck on the value of the whole business, debt included, against the operating profit analysts expect next year (forward EV/EBITDA), runs 2,000 simulations across its inputs and takes the midpoint. The full method is documented here.
What changed in the latest valuation?
On 26 Sep 2026 the model's fair value for MRK was $125.75. As of 3 Oct 2026 it is $121.57, a change of -3.3%. The model revalues every stock it covers each week, and again after an earnings report.
Questions about Merck's valuation
Is Merck stock undervalued or overvalued?
On Faircurve's model, MRK reads as Overvalued as of 3 Oct 2026. The model's fair value is $121.57 a share against a last close of $144.30, a gap of -15.8%.
What is MRK's fair value?
$121.57 a share as of 3 Oct 2026, the midpoint of 2,000 simulations. The model's own 20th to 80th percentile range is $84.84 to $169.25.
What price range does the model give MRK?
$131.71 to $167.85 over 63 trading days. Ranges built this way held the price 60% of the time across 3,562 past valuations, refreshed 3 Oct 2026.
When does Merck report earnings next?
The next report is scheduled for 29 Oct 2026. Companies can move their dates.
How much has MRK moved on past earnings reports?
Across its last 8 reports the median two session move was 2.8%, ignoring direction. The largest was -10.1% around the report of 4 Feb 2025.
How confident is the model in this valuation?
The model's evidence grade for MRK is medium. The grade looks at how complete the inputs are, how many comparable companies there are and how closely they agree, and how wide the range of outcomes is. It is not a probability that the fair value is right, or that the price reaches it.