# Merck & Co., Inc. (MRK) — Stock CV

Merck & Co., Inc. is a $361B healthcare company. Revenue grew 4.6% over the last year, it keeps 5¢ of every dollar of sales as profit, and its net debt equals ~2.2 years of free cash flow. It trades at 113.2× earnings — near the highest of its own history.

> Merck makes pharmaceutical products to treat several conditions in a number of therapeutic areas, including cardiometabolic disease, cancer, and infections. In cancer, the firm's immuno-oncology platform, led by Keytruda, is a major contributor to overall sales.

## Identity

- **Ticker**: MRK
- **Sector**: Healthcare
- **Industry**: Drug Manufacturers - General
- **Headquarters**: RAHWAY, NJ
- **Employees**: 75 000
- **Website**: https://www.merck.com
- **Market cap**: $361B
- **Last price**: $146.33
- **Financial profile**: Mixed

## Vitals (TTM)

- **Revenue**: $66.6B
- **Net income**: $3.17B
- **Free cash flow**: $16.1B
- **Net debt**: $34.8B
- **P/E**: 113.2
- **Revenue growth (YoY)**: 4.6%

## Skills (profile scores, 0–100)

| Pillar | Score |
|---|---|
| Valuation | 24 |
| Growth | 74 |
| Profitability | 43 |
| Health | 49 |
| Quality | 50 |
| Moat | 82 |

## Qualifications (beginner checklist) — 9 of 11 passed

- [x] Revenue growing — +4.6% YoY
- [x] Profitable — $3.17B TTM
- [x] Profit growing — +8.4% YoY
- [x] Generates cash — $16.1B TTM
- [x] Debt under control — ~2.2y of cash flow to repay
- [x] Established company — $361B market cap
- [x] Not printing shares — -1.4% shares over ~5y
- [x] Proven track record — 10/10 profitable years
- [ ] Financially stable — health score 37/100
- [x] Pays a dividend — yield 2.31%
- [ ] Valuation not extreme — P/E 113.2

## Experience (career milestones)

- **FY2025** — Best year on record: $18.3B net income
- **FY2022** — Revenue crossed $50B: $59.3B for the year
- **2020** — Merck acquired ArQule, developer of ARQ 531, an oral Bruton's tyrosine kinase (BTK) inhibitor, for…
- **FY2016** — Profitable every year on record: 10 consecutive profitable years in our data
- **FY2016** — Revenue already above $10B: $39.8B in first reported year
- **FY2016** — Positive free cash flow every year since: 10-year streak
- **2016** — The company acquired Afferent Pharmaceuticals, developer of a candidate used to block P2RX3 receptors,…
- **2015** — Merck acquired Cubist Pharmaceuticals for $102 per share in cash or about $9.5 billion in total
- **2014** — Merck acquired Idenix Pharmaceuticals for $3.85 billion
- **2009** — Merck & Co. completed a merger with Schering-Plough in a US$41 billion deal
- **1993** — Merck & Co. acquired Medco Containment Services for $6 billion
- **1979** — Merck scientists developed lovastatin (Mevacor), the first drug of the statin class
- **1967** — Maurice Hilleman, a scientist at Merck, developed the first mumps vaccine in 1967, the first rubella vaccine in 1969
- **1953** — Merck & Co. merged with Philadelphia-based Sharp & Dohme, Inc., becoming the largest U.S
- **1891** — Merck & Co. was established as the American affiliate of the Merck Group, founded by the Merck family

## Strengths

- High gross margin (77.3%)
- Strong cash conversion — FCF is 24.1% of revenue
- Interest covered 22.7× by operating earnings
- High returns on invested capital (ROIC 20.9%)

## Watch-outs

- None stand out in the data.

## Track record

| Year | Revenue | Net income | Free cash flow |
|---|---|---|---|
| FY2021 | $48.7B | $13.0B | $8.67B |
| FY2022 | $59.3B | $14.5B | $14.7B |
| FY2023 | $60.1B | $365M | $9.14B |
| FY2024 | $64.2B | $17.1B | $18.1B |
| FY2025 | $65.0B | $18.3B | $12.4B |

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Source: https://stockcv.com/MRK — derived from company filings; may be delayed or incomplete. Information, not investment advice.