HD vs MRK: Which Is the Better Buy?
Side-by-side comparison of The Home Depot, Inc. and Merck & Co., Inc. — fair value, conviction, valuation metrics, and QuantHub research signals.
Updated 2026-09-25.
The Home Depot, Inc. · Consumer Cyclical
$292.18
+44.2% upside to fair value
Med Conviction
Grade B
High Quality
VS
Merck & Co., Inc. · Healthcare
$147.17
-4.1% upside to fair value
Med Conviction
Grade C
QuantHub Verdict
HD has more upside to fair value
(+44.2%).
These are model outputs — not personalized investment advice.
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Valuation & Fundamentals
| Metric |
HD |
MRK |
| Current Price |
$292.18 |
$147.17 |
| Fair Value Estimate |
$421.26 |
$141.07 |
| Upside to Fair Value |
+44.2%
|
-4.1%
|
| Market Cap |
$291.3B |
$363.5B |
| Forward P/E |
—
|
—
|
| EV / EBITDA |
14.7x
|
29.6x
|
| Price / Sales |
1.7x
|
5.5x
|
| Price / FCF |
19.2x
|
22.6x
|
| Revenue Growth YoY |
+5.7%
|
+5.1%
|
| Gross Margin |
33.2%
|
75.4%
|
| Operating Margin |
12.4%
|
16.7%
|
| Return on Equity |
102.7%
|
6.6%
|
| Dividend Yield |
3.18% |
2.31% |
| FCF Yield |
5.2%
|
4.42%
|
| Analyst Consensus |
Strong Buy
|
Buy
|
Investment Thesis
The Home Depot is the largest home-improvement retailer in the United States, operating a network of roughly 2,300 stores supported by about 472,400 full-time employees, and serving both do-it-yourself homeowners and professional contractors through stores, homedepot.com, and specialty sites such as blinds.com. The business quality is high: it generates a 102.7% return on equity, a 33.2% trailing…
Merck & Co., Inc. is a global healthcare leader with two core divisions, Pharmaceuticals and Animal Health, spanning oncology, vaccines, acute hospital care, immunology, neuroscience, virology, cardiovascular and diabetes, and it employs roughly 74,000 people under CEO Robert Davis. The business quality is medium: TTM gross margin of 75.4% and TTM operating margin of 16.7% reflect a genuinely hig…
Accumulation Zones
| Metric |
HD |
MRK |
| Zone Low |
$315.94 |
$105.80 |
| Zone High |
$358.07 |
$119.91 |
| In Buy Zone? |
Yes
|
No
|