Should I buy Merck stock in 2025?

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At HelloSafe, our expert has been closely monitoring Merck’s performance for over three years. Each month, hundreds of thousands of users across the United States rely on us to interpret market trends and uncover top investment opportunities. Our analyses are designed for informational purposes only and do not represent investment advice. In line with our ethical guidelines, we have never been, and will never be, compensated by Merck.

What is Merck?

How much is Merck stock?

The price of Merck stock is falling this week. Merck & Co. (MRK) is currently trading at $83.26, down 2.28% ($1.94) over the last 24 hours and showing a weekly decrease of 4.28%. The company’s market capitalization stands at $209.51 billion, with an average 3-month daily volume of 17.79 million shares. Merck trades at a P/E ratio of 12.10 and offers a dividend yield of 3.89%. The stock has a beta of 0.42, indicating lower than average volatility. In the current context, Merck’s defensive profile and strong yield may appeal to long-term, income-focused investors amid short-term price swings.

Our full analysis on Merck stock

Having meticulously reviewed Merck & Co.’s latest quarterly financial results and stock performance over the past three years, our analysis integrates an array of financial metrics, technical signals, market trends, and competitive dynamics, synthesized through proprietary algorithms to deliver a multi-faceted view of the investment landscape. In light of the current equity repricing and sector rotation in healthcare, Merck’s profile stands out for both its resilience and unrealized valuation potential. So, why might Merck stock once again become a strategic entry point into the large-cap U.S. healthcare sector in 2025?

Recent Performance and Market Context

Merck shares have experienced a notable correction—down 35.4% over the past year and 18.3% in just the last six months—trading at $83.26 as of May 2, 2025 (52-week range: $75.93 – $134.63). Although this downward movement reflects sector-wide pressures, it arguably overshoots the company’s robust intrinsic value, particularly given the defensive nature of healthcare stocks in volatile macroeconomic environments. The healthcare sector’s proven resilience, in combination with rotation into value and dividend-rich equities amid persistent global uncertainty, is lending renewed favor to fundamentally sound pharmaceutical names such as Merck.

Recent positive developments further underpin confidence: Merck’s Q1 2025 results not only exceeded analyst EPS estimates ($2.22 vs. $2.15 consensus) but also showcased resilient growth in Keytruda and other franchises, despite modest headline revenue contraction (-2% YoY; 1% growth ex-FX). The company has continued to absorb external macro pressures—including $200 million in tariffs—demonstrating a capacity for agile adaptation and earnings stabilization.

Technical Analysis

From a technical perspective, Merck is displaying a compelling setup: the RSI (14-day) has reached a deeply oversold level of 26.1, commonly interpreted as a prelude to imminent mean-reversion or technical rebound. The MACD indicator, while still negative (-2.56), is decelerating, suggesting waning bearish momentum as the stock tests strong support at $76.46. The current price has moved below both its 5- and 20-day moving averages, chronically oversold conditions frequently associated with “washout” lows.

Recent price action places Merck within striking distance of critical support—historically a zone that attracts opportunistic buying interest, especially in high-quality, low-beta names. Should share price stabilize at or near this region, a reversal toward the next resistance ($90.27) may materialize in the short to medium term, reinforced by value-oriented inflows and technical normalization.

• Oversold RSI: High likelihood of mean reversion.
• Clear support at $76.46: Historically defended level.
• Decelerating bearish momentum: Potential exhaustion of sellers.
• Upside technical gap: Resistance at $90.27 as first medium-term price target.

Fundamental Analysis

Merck’s fundamentals continue to inspire confidence despite share price weakness. The company reported Q1 revenues of $15.5 billion (modest 2% YoY decline, but stable ex-currency), with adjusted EPS surpassing expectations. Keytruda, its blockbuster oncology drug, delivered 6% year-on-year sales growth to $7.2 billion, undergirding Merck’s dominance in immuno-oncology. Newer medicines and vaccines are delivering incremental contributions, further diversifying revenue sources.

Valuation remains exceptionally attractive in the current context. With a trailing P/E of 12.1, a forward P/E of 9.3, and a PEG ratio of just 0.76, Merck screens as fundamentally undervalued both relative to historical multiples and to large-cap pharma peers—many of which trade at higher P/E and PEG ratios. Its price-to-sales ratio of 3.31 and solid price-to-book multiple (4.52) indicate ongoing investor confidence in the capital-efficient business model and balance sheet strength.

• Strong cash generation and disciplined capital allocation
• High-margin franchise with Keytruda, vaccines, and pipeline assets
• Strategic investments in next-generation biologics and U.S. manufacturing
• Consistent shareholder returns—notably a forward annualized dividend yielding 3.89%, offering both income and defensive positioning amidst rate uncertainty

Volume and Liquidity

Sustained, robust trading activity reinforces confidence in Merck’s liquidity profile. With an average daily volume of 17.8 million shares and a public float of over 2.5 billion shares, investors benefit from tight bid-ask spreads, ample depth, and efficient execution. The stock’s relatively low beta (0.42) signals less volatility than the overall market, which may attract risk-averse, yield-seeking investors—especially as the value trade regains market leadership.

This high degree of liquidity, combined with a sizable institutional presence, is conducive to responsive valuation as positive catalysts emerge. The float structure thus supports dynamic repricing potential once technical and sentiment headwinds abate.

Catalysts and Positive Outlook

• Pipeline Momentum: Continued data readouts and regulatory milestones in oncology, immunology, and vaccines are anticipated in coming quarters. Keytruda’s label expansions and next-generation therapies provide additional growth vectors.
• Strategic Capacity Expansion: A new $1 billion investment in a Delaware biologics facility enhances Merck’s U.S. manufacturing base, strengthening supply chain resilience and supporting domestic policy initiatives.
• New Product Launches: Recent and upcoming introductions of innovative vaccines and specialty medicines are expected to accelerate revenue diversification beyond Keytruda—mitigating future patent cliff risk.
• ESG and Sustainability Initiatives: Merck’s clear commitment to sustainability, access to medicine, and ethical innovation may help attract ESG-focused capital and maintain stakeholder trust.
• Resilience to Economic Shocks: As a global leader with a broad product base and a proven management team, Merck is well-positioned to weather cyclical downturns and capitalize on macro health trends.

Additionally, Merck’s proactive management of tariff impacts and adept navigation of regulatory complexities support the view that near-term concerns are being effectively managed rather than posing existential risks.

Investment Strategies

• Short-Term: With technical indicators at oversold extremes and strong support intact, the stage seems set for an impending relief rally or “bounce back”—potentially yielding swift gains for nimble traders and tactical investors.
• Medium-Term: Upcoming pipeline updates, U.S. capacity expansion, and possible positive estimate revisions may catalyze upside through the remainder of 2025. The $90.27 resistance level constitutes an achievable interim objective, buoyed by improving sentiment and renewed institutional interest.
• Long-Term: For income and growth-focused investors, Merck offers a compelling risk-reward profile thanks to high dividend yield, structural innovation, dominant market share in oncology, and a global platform to capitalize on demographic tailwinds. The current valuation discount versus peers may unwind as new medicines and manufacturing initiatives deliver results, creating the backdrop for sustainable value creation.

Ideal positioning could be achieved at or near the current technical low, particularly ahead of key clinical milestones, earnings reports, or evidence of sector rotation.

Is it the Right Time to Buy Merck?

To summarize: Merck’s convergence of technical oversold readings, robust fundamental backbone, and an improving catalytic outlook mark this juncture as particularly constructive for new or increased positioning. The company’s financial discipline, diversified global product portfolio, and strategic investments all suggest that the rather severe correction of the past twelve months is disconnected from long-term value realities.

• Valuation is meaningfully below industry averages, with a PEG ratio well under 1—implying significant long-term earnings appreciation potential.
• Dividend yield is highly competitive for the sector, with the payout supported by strong cash flows.
• Structural innovation, a resilient business model, and extensive pipeline optionality underpin Merck’s ability to power through macro and regulatory headwinds.
• Technical conditions point to a possible inflection point, with historical evidence supporting the probability of recovery from oversold levels.

In conclusion, while near-term volatility may persist, all signs increasingly point toward Merck entering a renewed phase of value recovery. The stock’s current configuration seems to represent an excellent opportunity for investors seeking both stability and upside potential in the healthcare sector. As positive momentum builds behind fundamental and technical turning points, Merck could very well be at the threshold of its next bullish cycle—a scenario that smart capital may find hard to ignore.

How to buy Merck stock in United States?

Buying shares of Merck & Co. (MRK) online is both straightforward and secure when using a regulated U.S. broker. Most leading platforms allow you to invest in Merck stock quickly from the comfort of your home, with robust security and compliance safeguards. Today, you have two main options: spot buying (owning real shares for long-term holding) or trading via CFDs (Contracts for Difference) for flexible, leveraged strategies. Each approach suits different investor profiles. To help you select the optimal platform, we provide a detailed broker comparison further down the page.

Cash Buying

A cash purchase means you buy real Merck shares on the NYSE through your brokerage account. This method is ideal for investors wanting to own the underlying stock, potentially receive dividends, and benefit from long-term price appreciation. Most U.S. brokers charge a fixed commission per order—typically around $5.

Key Example

Example:
If Merck shares are priced at $83.26 each, with $1,000 (commission included) you can buy about 11 shares.

• Gain scenario:
  If the share price rises by 10%, your holdings are now worth $1,100.
• Result: +$100 gross gain, or +10% on your investment.

Trading via CFD

CFD trading allows you to speculate on Merck's price movements without actually owning the shares. You can go long or short, and often apply leverage to increase your exposure. With CFDs, brokers charge a spread (the difference between buy/sell price) and an overnight financing fee if you hold positions beyond a day.

Key Example

Example:
With a $1,000 deposit and 5x leverage, you open a CFD on Merck, giving exposure to $5,000 worth of shares.

• Gain scenario:
  If the share price climbs by 8%, your position grows by 8% × 5 = 40%.
• Result: +$400 gain on your $1,000 (excluding fees).

Final Advice

Before investing, it’s essential to compare brokers’ fees, trading conditions, and support services to find the best fit for your needs. Whether you prefer spot buying for ownership and dividends, or CFDs for greater flexibility and leverage, your choice should align with your financial goals and risk tolerance. You’ll find a detailed broker comparison just below to guide your selection.

Application

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30+ million users

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eToro

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4.9

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51% of CFD accounts lose money. You will never lose more than your investment.

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IG

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74% of CFD accounts lose money. Your capital is at risk.

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Avatrade

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4.8

On the broker's website

Our 7 tips for buying Merck stock

The latest news about Merck

Merck’s Q1 2025 earnings beat expectations with adjusted EPS of $2.22 versus estimates of $2.15. The company’s latest quarterly results published on May 2 confirmed that while total revenue slightly declined by 2% year-over-year (excluding currency effects, revenue edged up 1%), profitability outperformed analyst anticipations. Strong performance was driven by continued double-digit growth from Merck’s innovative medicines and vaccines portfolio in the United States, with Keytruda leading the way at $7.2 billion in quarterly sales—a 6% annual increase. This earnings beat reassured analysts that Merck’s core business remains durable despite recent headwinds.

Merck announced a $1 billion investment in a new biologics manufacturing facility in Delaware, boosting its U.S. presence and capacity. The company has committed significant capital to enhance its domestic production capabilities by establishing a new plant in the United States, demonstrating both its long-term confidence in demand and its response to policy pressure to secure the pharmaceutical supply chain within national borders. This strategic expansion is poised to create local jobs, increase production resilience, and reinforce Merck’s commitment to supplying innovative therapies to the American market.

Despite recent share price weakness, Merck’s technical indicators reveal an oversold condition, suggesting potential for a rebound. Following a 4.28% weekly decline and a larger multi-month drawdown, the stock has reached an RSI of 26.1, indicating a level that is commonly associated with oversold markets. The current testing of key support at $76.46 increases the likelihood that technically oriented investors may view the present phase as an attractive entry point, especially given the strong fundamentals and positive pipeline momentum.

Merck maintains a robust forward dividend yield of 3.89%, offering income stability amid volatility. With a forward annual dividend of $3.24 per share and a recent ex-dividend date in March, Merck continues to reward shareholders with above-average income in the U.S. healthcare sector. The company’s history of dividend consistency is a reassuring signal for income-focused investors, particularly those drawn to defensive names amidst broader market uncertainty.

Analyst consensus remains constructive, with a mean price target of $106.73, representing a substantial premium to the current price. Despite the recent correction, Wall Street estimates indicate confidence in Merck’s earnings power and future growth, underpinned by the company’s continuing investments, robust pipeline, and established franchises in oncology and vaccines. The 30% upside to the price target provides a positive risk/reward profile for U.S.-based institutional and retail investors considering medium- to longer-term exposure.

FAQ

P. Laurore

Finance expert

Co-founder of HelloSafe and holder of a Master's degree in finance, Pauline has recognised expertise in personal finance, which she uses to help users better understand and optimise their financial choices. At HelloSafe, Pauline plays a key role in designing clear, educational content on savings, investments and personal finance. Passionate about financial education, Pauline strives, with every piece of content she oversees, to provide reliable, transparent and unbiased information for independent and informed financial management. To this end, she has tested over 100 trading platforms to help internet users make the right choices.