Pfizer vs Merck: Which Pharma Giant is the Smarter Dividend Play?

Pfizer and Merck have presented different stories in their latest quarterly reports, which has sparked debate among investors about which company is the smarter dividend play.

Pfizer's revenue reached $14.45 billion, beating estimates, with launched or acquired products growing 22% operationally. However, the company's COVID-19 franchise has seen a significant decline, with Comirnaty falling 59% and Paxlovid dropping 62%. The adjusted earnings per share (EPS) of $0.75 marked a fifth straight beat, but net income slid 9.44%.

Merck, on the other hand, has seen its revenue reach $16.29 billion, surpassing expectations. Keytruda produced $8.03 billion, up 12%, and the subcutaneous version Keytruda QLEX added $128 million out of the gate. Winrevair surged 88% to $525 million.

The dividend math tells a different story for each company. Pfizer pays $0.43 quarterly ($1.72 annualized) against a 6.75% yield, with raises every Q1 since 2010. Merck lifted its quarterly dividend from $0.81 to $0.85 starting Q1 2026, with a forward annualized rate of $3.40, roughly 2.6% at recent prices.