WallStSmart

CVS Health Corp (CVS)vsMerck & Company Inc (MRK)

VS

Smart Verdict

WallStSmart Research — data-driven comparison

CVS Health Corp generates 515% more annual revenue ($399.83B vs $65.01B). MRK leads profitability with a 28.1% profit margin vs 0.4%. CVS appears more attractively valued with a PEG of 0.20. CVS earns a higher WallStSmart Score of 65/100 (C+).

CVS

Buy

65

out of 100

Grade: C+

Growth: 7.3Profit: 4.0Value: 4.7Quality: 5.0
Piotroski: 4/9Altman Z: 2.11

MRK

Buy

59

out of 100

Grade: C

Growth: 4.0Profit: 9.5Value: 4.0Quality: 4.8
Piotroski: 3/9
IV

Intrinsic Value Comparison

Multi-model valuation · Graham Formula

CVSSignificantly Overvalued (-18.4%)

Margin of Safety

-18.4%

Fair Value

$65.05

Current Price

$70.08

$5.03 premium

UndervaluedFair: $65.05Overvalued
MRKSignificantly Overvalued (-141.3%)

Margin of Safety

-141.3%

Fair Value

$49.57

Current Price

$119.63

$70.06 premium

UndervaluedFair: $49.57Overvalued

Key Strengths & Concerns

Side-by-side fundamental analysis

Key Strengths

CVS5 strengths · Avg: 9.4/10
PEG RatioValuation
0.2010/10

Growing faster than its price suggests

Price/BookValuation
1.2x10/10

Reasonable price relative to book value

EPS GrowthGrowth
76.6%10/10

Earnings expanding 76.6% YoY

Market CapQuality
$89.16B9/10

Large-cap with strong market position

Free Cash FlowQuality
$2.61B8/10

Generating 2.6B in free cash flow

MRK6 strengths · Avg: 9.2/10
Market CapQuality
$295.77B10/10

Mega-cap, among the largest globally

Return on EquityProfitability
36.9%10/10

Every $100 of equity generates 37 in profit

Operating MarginProfitability
32.8%10/10

Strong operational efficiency at 32.8%

Profit MarginProfitability
28.1%9/10

Keeps 28 of every $100 in revenue as profit

P/E RatioValuation
16.4x8/10

Attractively priced relative to earnings

Free Cash FlowQuality
$1.82B8/10

Generating 1.8B in free cash flow

Areas to Watch

CVS4 concerns · Avg: 3.0/10
Return on EquityProfitability
2.3%3/10

ROE of 2.3% — below average capital efficiency

Profit MarginProfitability
0.4%3/10

0.4% margin — thin

Operating MarginProfitability
1.6%3/10

Operating margin of 1.6%

Debt/EquityHealth
1.243/10

Elevated debt levels

MRK3 concerns · Avg: 2.3/10
Piotroski F-ScoreQuality
3/93/10

Weak financial health signals

PEG RatioValuation
3.492/10

Expensive relative to growth rate

EPS GrowthGrowth
-19.3%2/10

Earnings declined 19.3%

Comparative Analysis Report

WallStSmart Research

Bull Case : CVS

The strongest argument for CVS centers on PEG Ratio, Price/Book, EPS Growth. PEG of 0.20 suggests the stock is reasonably priced for its growth.

Bull Case : MRK

The strongest argument for MRK centers on Market Cap, Return on Equity, Operating Margin. Profitability is solid with margins at 28.1% and operating margin at 32.8%.

Bear Case : CVS

The primary concerns for CVS are Return on Equity, Profit Margin, Operating Margin. A P/E of 50.4x leaves little room for execution misses. Thin 0.4% margins leave little buffer for downturns.

Bear Case : MRK

The primary concerns for MRK are Piotroski F-Score, PEG Ratio, EPS Growth.

Key Dynamics to Monitor

CVS carries more volatility with a beta of 0.46 — expect wider price swings.

CVS is growing revenue faster at 8.4% — sustainability is the question.

CVS generates stronger free cash flow (2.6B), providing more financial flexibility.

Monitor HEALTHCARE PLANS industry trends, competitive dynamics, and regulatory changes.

Bottom Line

CVS scores higher overall (65/100 vs 59/100). Both earn "Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.

This analysis is generated from publicly available financial data. Not financial advice.

CVS Health Corp

HEALTHCARE · HEALTHCARE PLANS · USA

CVS Health (previously CVS Corporation and CVS Caremark Corporation) is an American healthcare company that owns CVS Pharmacy, a retail pharmacy chain; CVS Caremark, a pharmacy benefits manager; Aetna, a health insurance provider, among many other brands. The company's headquarters is in Woonsocket, Rhode Island.

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Merck & Company Inc

HEALTHCARE · DRUG MANUFACTURERS - GENERAL · USA

Merck & Co. is an American multinational pharmaceutical company headquartered in Kenilworth, New Jersey. It is named after the Merck family, which set up Merck Group in Germany in 1668.

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