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Learn moreMerck (MRK) was at the center of a major cancer-treatment update in August. Specifically, the drugmaker and Moderna (MRNA) said their personalized mRNA cancer therapy, intismeran autogene, delivered positive results in a Phase 3 study involving 1,137 patients with high-risk melanoma.
Used with Keytruda, the treatment reduced the risk of cancer returning or causing death and improved distant metastasis-free survival compared with Keytruda alone. Merck shares jumped 11% on the news. That was a big move for the stock, which had posted only five single-day gains of more than 5% over the past year.
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The news added to an already strong run for Merck. Currently, MRK stock is up 36% year-to-date (YTD), ahead of the Nasdaq Composite's ($NASX) 12% gain over the same period. The company is also paying investors to wait for the longer-term potential of its cancer pipeline. Merck declared a quarterly dividend of $0.85 per share, payable on Oct. 7 to shareholders of record on Sept. 15. That works out to about $3.40 per share annually and gives the stock a yield of about 2.36%.
Can Merck keep delivering both share-price gains and dividend income heading into 2027? Let's take a closer look.
Financial Strength Behind Merck Stock
Merck sells prescription drugs, vaccines, and animal-health products. Its biggest product is Keytruda, a leading cancer treatment that remains the main driver of its oncology business.
The stock has had a strong run this year. MRK stock is up 77% over the past 52 weeks and has gained 37% so far this year.
That rally has made the shares more expensive. Merck stock trades at 52 times forward earnings, compared with the healthcare sector average of roughly 18 times.
Merck also gives investors a dividend. The company pays every quarter and has increased its dividend for 15-straight years. Its annual dividend is $3.40 per share. That gives the stock a 2.36% yield, which is above the healthcare sector average of 1.5%. The latest payment was $0.85 per share on July 8. However, the forward payout ratio is 103.5%, meaning expected dividend payments are slightly higher than projected earnings.
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