Between Johnson & Johnson and Merck, Which Stock Looks Set to Break Out?
Merck surged 5.6% during the past Day. You may be tempted to buy more, or may want to reduce your exposure. But there is an entirely different perspective you might be missing. Is there a better alternative? Turns out, its peer Johnson & Johnson gives you more. Johnson & Johnson (JNJ) stock offers superior revenue growth across key periods, better profitability, and relatively lower valuation vs Merck (MRK) stock, suggesting you may be better off investing in JNJ
- JNJ’s quarterly revenue growth was 9.9%, vs. MRK’s 4.9%.
- In addition, its Last 12 Months revenue growth came in at 7.9%, ahead of MRK’s 2.9%.
- JNJ leads on profitability over both periods – LTM margin of 26.8% and 3-year average of 25.6%.
These differences become even clearer when you look at the financials side by side. The table highlights how MRK’s fundamentals stack up against those of JNJ on growth, margins, momentum, and valuation multiples.
Valuation & Performance Overview
| MRK | JNJ | Preferred | |
|---|---|---|---|
| Valuation | |||
| P/EBIT Ratio | 23.3 | 21.9 | JNJ |
| Revenue Growth | |||
| Last Quarter | 4.9% | 9.9% | JNJ |
| Last 12 Months | 2.9% | 7.9% | JNJ |
| Last 3 Year Average | 4.4% | 4.4% | JNJ |
| Operating Margins | |||
| Last 12 Months | 19.7% | 26.8% | JNJ |
| Last 3 Year Average | 19.9% | 25.6% | JNJ |
| Momentum | |||
| Last 3 Year Return | 17.2% | 62.1% | JNJ |
Note: For “Last 3 Year Return” metric, preferred stock is one with higher returns unless the returns are too high (>300%) which creates risk of sell off.
See detailed fundamentals on Buy or Sell JNJ Stock and Buy or Sell MRK Stock. Below we compare market return and related metrics across years.
Historical Market Performance
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | Avg | Best | |
|---|---|---|---|---|---|---|---|---|---|
| Returns | |||||||||
| MRK Return | 2% | 49% | 1% | -6% | 10% | 11% | 75% | ||
| JNJ Return | 11% | 6% | -9% | -5% | 47% | 13% | 71% | ||
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 9% | 98% | <=== | |
| Monthly Win Rates [3] | |||||||||
| MRK Win Rate | 42% | 67% | 42% | 33% | 50% | 60% | 49% | ||
| JNJ Win Rate | 58% | 58% | 50% | 42% | 83% | 60% | 59% | ||
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 60% | 64% | <=== | |
| Max Drawdowns [4] | |||||||||
| MRK Max Drawdown | -20% | -11% | -14% | -27% | -27% | -11% | -18% | ||
| JNJ Max Drawdown | -12% | -13% | -17% | -14% | -13% | -11% | -13% | ||
| S&P 500 Max Drawdown | -5% | -25% | -10% | -8% | -19% | -9% | -13% | <=== | |
[1] Cumulative total returns since the beginning of 2021
[2] 2026 data is for the year up to 5/22/2026 (YTD)
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
Still not sure about MRK or JNJ? Consider portfolio approach.
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