10 Best High-Margin Pharma Stocks to Buy Now

6. Merck & Company, Inc. (NYSE:MRK)

TTM Operating Profit Margin: 38.19%

Average Analyst upside: 25.02%

Number of Hedge Fund Holders: 93

Merck & Company, Inc. (NYSE:MRK) is one of the high-margin pharma stocks to buy now. Jefferies has raised its price target on Merck & Co. (NYSE: MRK) to $141 from $138 while maintaining a Buy rating, citing increased conviction in the company’s recent acquisition of Verona Pharma. The firm’s analysts see the $10 billion deal as a strategic step to diversify Merck’s pipeline and reduce long-term reliance on its flagship cancer drug, Keytruda.

In a research note, Jefferies highlighted Verona’s lead asset, ensifentrine, as a potentially meaningful addition to Merck’s respiratory portfolio. The drug, which is being developed for chronic obstructive pulmonary disease (COPD), offers a differentiated mechanism of action and a favorable safety profile, according to analysts. They estimate the acquisition could add approximately $3 per share in value under a base-case scenario. Even under more conservative assumptions, the transaction is still expected to be accretive.

The target increase comes as Merck & Co. (NYSE: MRK) continues to face pressure to shore up its post-Keytruda growth strategy, with the immunotherapy expected to lose U.S. exclusivity in the coming years. Jefferies’ revised outlook signals confidence in Merck’s ability to execute on strategic M&A while maintaining earnings visibility. Shares of Merck have remained stable following the announcement, reflecting cautious investor optimism as the company pivots toward new therapeutic areas.