MerckLIM:MRK 69 Gross Margin % is 74.24% as of Mar. 2026, which is 6% above its 10-year median of 69.96. GuruFocus rates LIM:MRK with a GF Score™ of 69/100 and a GF Value™ of $109.83 (Fairly Valued). The stock has 7 warning signs investors should review. Among 935 Drug Manufacturers companies, Merck ranks better than 86.84% on this metric.
Gross Margin % is calculated as gross profit divided by its revenue. Merck's Gross Profit for the
three
months ended in Mar. 2026 was $12,091 Mil. Merck's Revenue for the
three
months ended in Mar. 2026 was $16,286 Mil. Therefore, Merck's Gross Margin % for the quarter that ended in Mar. 2026 was 74.24%.
The historical rank and industry rank for Merck's Gross Margin % or its related term are showing as below:
LIM:MRK'
s Gross Margin % Range Over the Past 10 Years
Min: 64.75 Med: 69.96 Max: 76.32
Current: 73.91
During the past 13 years, the highestGross Margin % of Merck was 76.32%. The lowest was 64.75%. And the median was 69.96%.
LIM:MRK's Gross Margin % is ranked better than 86.84% of 935
companies
in the Drug Manufacturers industry
Industry Median: 48.54
vs LIM:MRK: 73.91
Merck had a gross margin of 74.24% for the quarter that ended in Mar. 2026 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Merck was 2.20% per year.
Merck (LIM:MRK) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Merck had a gross margin of 74.24% for the quarter that ended in Mar. 2026 => Durable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Merck Gross Margin % Related Terms
Merck Gross Margin % Historical Data
* Premium members only.
The historical data trend for Merck's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
LIM:MRK vs AMGN, ABBV, GILD: Gross Margin % Comparison
For the Drug Manufacturers - General subindustry, Merck's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Merck Gross Margin % vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Merck's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Merck's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Merck (LIM:MRK) has a Gross Margin % of 74.24% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Merck and its competitors. This is near median its historical median of 69.96. Over the past decade, Merck's Gross Margin % has ranged from 64.75 to 76.32. According to the industry distribution chart, Merck ranks #123 out of 935 companies in the Drug Manufacturers industry, placing it in the top 13.2%.
Is Merck's Gross Margin % too high?
Merck's current Gross Margin % of 74.24% is near median its 10-year median of 69.96. Over the past 10 years, this metric has ranged from a low of 64.75 to a high of 76.32. The Drug Manufacturers industry median Gross Margin % is 48.54. Merck's value of 74.24% is 52.9% above this industry median. Based on the distribution chart, Merck ranks #123 out of 935 companies in the Drug Manufacturers industry, which is in the top quartile — a strong position relative to peers. Overall, Merck has a GF Score™ of 69/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Merck's Gross Margin % compare to AMGN and ABBV?
According to the Drug Manufacturers industry distribution chart, Merck ranks #123 out of 935 companies for Gross Margin %. This places Merck in the top 13% of its industry — outperforming the majority of peers. The industry median Gross Margin % is 48.54. Merck's value of 74.24% is 52.9% above this benchmark. Historically, Merck's own Gross Margin % has ranged from 64.75 to 76.32 over the past decade. While the company's 10-year median is 69.96 vs. the industry median of 48.54, Merck has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Drug Manufacturers company?
The median Gross Margin % among Drug Manufacturers companies is 48.54, based on 935 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Merck's current Gross Margin % of 74.24% is 52.9% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Merck and its competitors. For the Drug Manufacturers industry, the median Gross Margin % is 48.54 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Merck's current Gross Margin % is 74.24%, which is near median its own 10-year median of 69.96. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Merck stock overvalued right now?
Based on GuruFocus' analysis, Merck (LIM:MRK) is currently considered Fairly Valued. The stock's GF Value™ is $109.83, compared to a current price of $120.00 — trading 9.3% above its estimated fair value. The current Gross Margin % is 74.24%, which is near median its 10-year median of 69.96 and 52.9% above the Drug Manufacturers industry median of 48.54. Merck's overall GF Score™ is 69/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Merck (LIM:MRK), the current Gross Margin % is 74.24% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Merck (LIM:MRK) Overvalued in 2026?
Based on GuruFocus' analysis, Merck stock appears to be overvalued.
The current stock price of $120.00 is trading 9.3% above its estimated GF Value™ of $109.83.
GuruFocus considers Merck to be Fairly Valued.
Key valuation signals for LIM:MRK:
Gross Margin %: 74.24% (near median its 10-year median of 69.96)
GF Value™: $109.83 vs. price of $120.00 (9.3% above fair value)
Industry Position: 52.9% above the Drug Manufacturers median (#123 of 935)
No single metric tells the full story. See the LIM:MRK stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Merck makes pharmaceutical products to treat several conditions in a number of therapeutic areas, including cardiometabolic disease, cancer, and infections. Within cancer, the firm's immuno-oncology platform, led by Keytruda, is a major contributor to overall sales. The company also has a substantial vaccine business aimed at preventing pediatric diseases, as well as Gardasil for human papillomavirus. Additionally, Merck sells animal health-related drugs. From a geographical perspective, 47% of the company's sales are generated from US human health (pharmaceuticals and vaccines).
69GF Score
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