Key Stats for Merck Stock
- Current Price: $145.60
- Target Price (Mid): ~$164
- Street Target: ~$158
- Potential Total Return: ~13%
- Annualized IRR: ~3% / year
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What Happened?
Merck (MRK) closed at $145.60 on October 9, up 38% from its $105.26 close at the end of 2025. On September 14, Chairman and CEO Robert Davis told a Morgan Stanley conference that Merck’s non-risk-adjusted sales opportunity of more than $70 billion by the mid-2030s will be raised. On October 7, a Dutch court blocked Keytruda SC, the version built to defend Merck’s top drug, in eight countries. Merck’s investor relations materials set the next tests: an ESMO investor event on October 26 and Q3 results on October 29.
Two Multibillion-Dollar Assets Sit Outside the $70 Billion
“I think, yes, you should assume we see upside to the $70 billion, and I’ll give some reasons why,” Davis said. The leukemia drug from Merck’s $6.7 billion Terns Pharmaceuticals deal, which he called “a multibillion-dollar opportunity,” is not in the figure. Neither is MK-2010, a PD-1/VEGF drug he said is starting multiple studies. The cancer vaccine partnered with Moderna (MRNA) is already counted, but Davis said its opportunity “probably could be bigger now” after an interim Phase 3 melanoma win.
LIPFENDRA, Merck’s oral cholesterol pill, shows ambition. Davis said 30 million Americans on lipid-lowering drugs are not at goal, and roughly 5% of eligible patients take a PCSK9 drug. His goal is “50% or more.” He expects the majority of commercial coverage by the end of 2027 and Medicare coverage by 2028.
Not every asset is clean. On September 25, Merck and Daiichi Sankyo withdrew a U.S. accelerated-approval filing for ifinatamab deruxtecan in small-cell lung cancer, though a Phase 3 trial continues. On September 24, topline results for the eye drug remigromig met the main goal. They also showed higher rates of proliferative diabetic retinopathy, vitreous hemorrhage, and discontinuations than ranibizumab. Davis also suggested the raise would probably follow last year’s timing, “at the beginning of the year.”
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The Rally Came From a Higher Multiple
Between December 31, 2025, and October 9, Merck’s NTM normalized EPS estimate slipped to around $8.40 from around $8.60. Over the same stretch, its NTM P/E climbed to around 17x from around 12x. Investors are paying more for slightly lower near-term earnings, betting the pipeline outruns Keytruda’s 2028 patent losses. The consensus 2030 revenue estimate rose to around $76 billion from around $68 billion a year earlier (now 13 analysts, up from 9). Merck sits above Novartis (NOVN) at around 15x and Bristol-Myers Squibb (BMY) at around 9x. It sits below Johnson & Johnson (JNJ) at around 23x and Eli Lilly (LLY) at around 30x.
A Dutch court found Keytruda SC infringes a Halozyme Therapeutics (HALO) patent and ordered Merck to stop selling it in eight European countries; IV Keytruda is unaffected. Keytruda SC brought in $463 million of Keytruda’s $8.4 billion in second-quarter sales. Moving patients to it is meant to soften biosimilar losses. Halozyme also holds a German preliminary injunction and is suing over 15 patents in the U.S., while Merck says it will fight.
Shares rose 0.60% on October 7, the day of the ruling. Analysts moved both ways. Morgan Stanley trimmed its target to $177 from $179 on October 7, and BofA cut to $163 from $166 on October 8, while Cantor Fitzgerald raised to $145 from $120. The Street mean sits around $158, with 14 Buy, 5 Outperform, and 8 Hold ratings.
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TIKR Advanced Model Analysis
- Current Price: $145.60
- Target Price (Mid): ~$164
- Potential Total Return: ~13%
- Annualized IRR: ~3% / year
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The mid case lands at around $164 by December 31, 2030, between the Street’s mean and median targets. That is about 13% above $145.60, or around 3% a year. Over its 2025 to 2035 forecast, it assumes around 2% annual revenue growth and net income margins near 33%. It also assumes a P/E that keeps rising around 2% a year. The main risk is Keytruda erosion after 2028, outrunning launches. A raised pipeline number that lifts revenue estimates is the upside. The downside sits in the multiple: the model needs 17x to hold and grow, and the stock traded near 12x in December.
Conclusion
Consensus expects Q3 revenue around $17.3 billion, roughly flat with last year’s $17.28 billion. Adjusted EPS is expected to be around $2.13, down around 18%. Dean Li, president of Merck Research Labs, said a louder melanoma signal would “somewhat derisk” what he called a “relatively conservative plan” for the vaccine in other tumor types. A beat plus new pipeline detail on October 26 would support 17x. Another Keytruda SC loss would test it.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
