Why Merck Stock Jumped 60%?
From mid-May 2025 to early February 2026, Merck (MRK) surged 61%, fueled by robust new product gains and strategic portfolio moves. Yet, a sharp 39% drop in Gardasil sales triggered a recent 4.5% pullback after Q4, hinting the rally’s not without its challenges.
Below is an analytical breakdown of stock movement into key contributing metrics.
| 5182025 | 2122026 | Change | |
|---|---|---|---|
| Stock Price ($) | 73.9 | 119.2 | 61.3% |
| Total Revenues ($ Mil) | 63,922.0 | 64,235.0 | 0.5% |
| Net Income Margin (%) | 27.3% | 29.6% | 8.6% |
| P/E Multiple | 10.7 | 15.6 | 46.1% |
| Shares Outstanding (Mil) | 2,523.0 | 2,495.0 | 1.1% |
| Cumulative Contribution | 61.3% |
So what is happening here? The stock surged over 61%, driven by a modest revenue uptick, improved profit margins, and a rising P/E multiple, despite a slight drop in shares outstanding. Here’s what fueled this momentum.
Here Is Why Merck Stock Moved
- Keytruda Dominance: Keytruda 2025 sales reached $31.7B, growing 7%, driven by earlier-stage approvals and new indications, extending oncology revenue runway.
- New Product Momentum: WinRevair achieved $1.4B in 2025 sales, Capvaxive $759M, and positive enlicitide data. This opens new market segments beyond oncology.
- Strategic Portfolio Boost: SpringWorks acquisition (EUR3.2B) and Ezmekly EU approval expanded rare tumor portfolio, augmenting future growth and diversifying assets.
- Stable Animal Health: Animal Health segment posted 8% growth to $6.4B in 2025, providing consistent, diversified revenue stability.
- Gardasil Headwinds & Recent Pullback: Gardasil sales declined 39% in 2025. Despite a 61% period gain, stock pulled back ~4.5% from its 52-week high post Q4 earnings, reflecting this decline.
Current Assesment Of MRK Stock
The core investment debate is centered around: Can Merck’s new product launches and pipeline (Winrevair, Capvaxive, subcutaneous Keytruda) generate enough revenue to offset the catastrophic 2028 loss of exclusivity for Keytruda, which represents nearly 50% of sales?
The prevailing sentiment appears to be neutral. Keytruda remains a rock, and the new launches are real. But the Gardasil franchise is cracking, and forward estimates are dropping due to M&A costs. The massive, unavoidable 2028 patent cliff keeps conviction in check.
| Bull View | Bear View |
|---|---|
| Strong initial sales from Winrevair and Capvaxive, plus the Keytruda life-cycle extension, provide a credible, tangible bridge to a future of diversified, durable growth post-2028. | The scale of the Keytruda revenue cliff is too large to overcome. Pipeline execution risk is high, as shown by recent failed M&A, and new products will face their own competitive pressures. |
Navigating the competing bull and bear cases of any single stock carries inherent volatility. Managing that idiosyncratic risk requires a broader portfolio framework.
Smart Wealth Management Means Diversifying Beyond Equities
In an environment of fear and greed, individual picks expose you to unnecessary risk. A comprehensive wealth approach positions you effectively to manage risk and capitalize on global trends.
Are you positioned to outperform over the next 1-3 years? We analyzed if adding allocations like 10% commodities and 10% gold to a standard stock-bond portfolio boosts returns. The results are clear: real assets matter. Our wealth management partner builds these robust portfolios to capture growth, while leveraging the Trefis High Quality Portfolio for superior stock selection.