Skip to Content

Merck & Co Inc

View Stock Summary
Morningstar Rating for Stocks Fair Value Economic Moat Capital Allocation

Merck Earnings: Solid Results Led by Keytruda; Firm Working to Mitigate Eventual Biosimilar Pressure

We are maintaining our $103 fair value estimate for Merck after third-quarter results that were slightly higher than we projected, but some of the outperformance was due to robust international sales of COVID-19 treatment Lagevrio that seem unlikely to continue. The underlying core business looks solid, with operational sales growth of 8% (excluding Lagevrio), led by cancer drug Keytruda (up 17%). Merck’s steady pipeline innovation, especially the movement of Keytruda into earlier lines of lung cancer, should enable a 5% annual compound growth rate over the next five years. Further, Merck’s earnings should grow faster as royalty payments on human papillomavirus vaccine Gardasil and Keytruda fall in 2024.

Free Trial of Morningstar Investor

Get our analysts’ objective, in-depth, and continuous investment coverage of MRK so you can make buy / sell decisions free of market noise.

Start Free Trial

Sponsor Center