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 2026-05-20.
The Home Depot, Inc. · Consumer Cyclical
$302.44
+22.0% upside to fair value
Med Conviction
Grade B+
VS
Merck & Co., Inc. · Healthcare
$114.27
+3.3% upside to fair value
Grade C
High Quality
QuantHub Verdict
HD has more upside to fair value
(+22.0%).
HD trades at a lower forward P/E
(20.5x).
These are model outputs — not personalized investment advice.
See all research →
Valuation & Fundamentals
| Metric |
HD |
MRK |
| Current Price |
$302.44 |
$114.27 |
| Fair Value Estimate |
$369.00 |
$118.00 |
| Upside to Fair Value |
+22.0%
|
+3.3%
|
| Market Cap |
$301.2B |
$282.2B |
| Forward P/E |
20.5x
|
22.4x
|
| EV / EBITDA |
16.5x
|
13.5x
|
| Price / Sales |
2.0x
|
4.3x
|
| Price / FCF |
26.6x
|
20.2x
|
| Revenue Growth YoY |
+4.8%
|
+5.0%
|
| Gross Margin |
33.3%
|
81.9%
|
| Operating Margin |
12.7%
|
27.5%
|
| Return on Equity |
110.5%
|
5.6%
|
| Dividend Yield |
2.72% |
2.91% |
| FCF Yield |
3.75%
|
4.95%
|
| Analyst Consensus |
Buy
|
Overweight
|
Investment Thesis
Home Depot remains the world's largest home improvement retailer with 2,350+ stores, dominant 52% market share, and an expanding Pro contractor segment bolstered by the SRS Distribution acquisition. Q1 FY2026 results released May 19 beat both the top and bottom line, with revenue of $41.77B up 4.8% year over year and adjusted EPS of $3.43 versus the $3.41 consensus. Comp sales grew only 0.6% howe…
Merck delivered a clean Q1 2026 operational beat on April 30, with revenue of 16.3 billion dollars growing 5 percent year over year and Keytruda sales rising 12 percent to 8.0 billion dollars. The reported loss of 1.28 dollars per share, though better than the negative 1.47 dollar consensus estimate, reflected a 3.62 dollar per share IPR and D charge tied to the Cidara Therapeutics acquisition an…
Accumulation Zones
| Metric |
HD |
MRK |
| Zone Low |
$276.75 |
$88.50 |
| Zone High |
$313.65 |
$100.30 |
| In Buy Zone? |
Yes
|
No
|