MRK
Merck & Co Inc
Price:  
83.71 
USD
Volume:  
18,439,554
United States | Pharmaceuticals

Merck Fair Value

107.4 %
Upside

What is the fair value of Merck?

As of 2025-07-10, the Fair Value of Merck & Co Inc (MRK) is 173.57 USD. This value is based on the Peter Lynch's Fair Value formula. With the current market price of 83.71 USD, the upside of Merck & Co Inc is 107.4%.

Is Merck a good investment?

With the market price of 83.71 USD and our fair value calculation, Merck & Co Inc (MRK) is a good investment. Investing in Merck stocks now will result in a potential gain of 107.4%.

83.71 USD
Stock Price
173.57 USD
Fair Price
FAIR VALUE CALCULATION

Merck Fair Value

Peter Lynch's formula is:

Merck Fair Value
= Earnings Growth Rate x TTM EPS
Merck Fair Value
= 25 x 6.94
Merck Fair Value
= 173.57

The earnings growth rate we use in the formula is the average growth rate of net income/earnings over the last 5 years. If the average growth rate is smaller than 5%, we set it to 5%. If it is larger than 25%, we set it to 25%. If the TTM EPS is negative, Peter Lynch Fair Value's result can be unreliable.

Historical Earnings
12-202012-202112-202212-202312-20245Y Avg
Net income7,06713,04914,51936517,11710,423
YoY growth-28.2%84.6%11.3%-97.5%4589.6%912%

Merck Fair Value - Peers Benchmarking

Market Cap (mil)EPS Fair Value Upside
a
Eli Lilly and Co745,79611.7146.39-81.4%
Pfizer Inc145,3181.434.6735.6%
Bristol-Myers Squibb Co96,9922.713.31-72.1%
Zoetis Inc70,4635.761.4-61.2%
Horizon Therapeutics PLC26,6321.947.82-58.9%
Catalent Inc11,522-2.3-11.38-117.9%
Viatris Inc10,833-3.2-16.15-274.9%
Jazz Pharmaceuticals PLC6,8787.893.21-16.5%
Bausch Health Companies Inc3,392-0.1-0.74-108%
Taro Pharmaceutical Industries Ltd1,6151.47.16-83.3%

Merck Fair Value - Key Data

Market Cap (mil)210,198
P/E12.1x
Forward P/E12.5x
EPS6.94
Avg earnings growth rate912%
TTM earnings17,434

Merck Fair Value - Formula's Origin

Peter Lynch is one of the most legendary investors/fund managers of all time. His philosophy for stock investing is very simple and straightforward: he invests in stocks that are undervalued, meaning its P/E is less than or equal to its earnings growth rate. He believes that if a stock is trading at its fair value, the PEG ratio, which was also invented by him, should be 1.

Therefore, his formula to determine a company's fair value is:

Peter Lynch Fair Value = Earnings Growth Rate * EPS * PEG

PEG is set to 1 so we can ignore it in the calculation. Based on the formula, if the earnings growth rate of a company is 15%, Peter Lynch is willing to buy its share up to P/E = 15.