Merit Medical Systems (MMSI) kicked off Q1 2026 with revenue of US$381.9 million and basic EPS of US$0.69, alongside trailing twelve month revenue of about US$1.5 billion and EPS of US$2.35 that frame the latest quarter against a fuller year of performance. Over the past year, revenue has moved from US$355.4 million in Q1 2025 to US$381.9 million in Q1 2026, while basic EPS has shifted from US$0.51 to US$0.69. This gives investors a clearer read on how profit per share tracks alongside topline growth. With trailing net margin around 9% and earnings expanding faster than revenue, the focus now turns to how durable these profit levels look as new quarters roll through.

See our full analysis for Merit Medical Systems.

With the latest figures on the table, the next step is to set these results against the most common stories around Merit Medical Systems to see which narratives the numbers support and which ones they start to challenge.

Net income climbs to US$41 million on steady topline

• Net income excluding extra items for Q1 2026 was US$40.995 million, up from US$30.147 million in Q1 2025, while total revenue moved from US$355.351 million to US$381.877 million over the same quarters.
• Bears focus on the risk that revenue growth settles in the mid single digit range, with bearish assumptions of around 5.9% annual revenue growth and profit margins rising from 9.0% to 11.5%, and this quarter gives them mixed signals:
  • The last twelve months show net income of US$139.337 million on US$1.542 billion of revenue, compared with US$122.264 million on US$1.388 billion a year earlier, which aligns with the idea that margins can edge higher while revenue growth stays moderate.
  • At the same time, Q1 2026 revenue of US$381.877 million is close to the last few quarters, which critics highlight as evidence that any move from a 9.0% to 11.5% margin will likely need careful cost control rather than rapid sales expansion.

Skeptics warn that if revenue growth stays closer to the 5% to 6% range assumed in the bearish narrative, Merit will need those margin gains to justify earnings expectations and its current profit levels. This makes execution on cost and mix especially important over the next few years. 🐻 Merit Medical Systems Bear Case

Trailing EPS of US$2.35 tests bullish growth hopes

• On a trailing twelve month basis, basic EPS stands at US$2.35, compared with US$2.17 at the end of 2025 and US$2.07 at the end of 2024, while quarterly EPS moved from US$0.47 in Q4 2024 to US$0.69 in Q1 2026.
• Supporters point out that analysts expect earnings to climb to about US$197.1 million, with EPS reaching US$3.07 by around 2029 and margins increasing from roughly 8.5% to 10.8%, and the current EPS trend offers some backing for that view:
  • Over the last twelve months, net income rose from US$120.357 million to US$139.337 million, which sits in the same direction as the 14% year over year earnings growth noted in the analysis data and the forecast of around 12.35% annual earnings growth.
  • However, five year earnings growth of 27% per year is higher than the most recent one year figure of 14%, so the current US$2.35 EPS also shows that the pace is already slower than the long term average, which means bulls are relying more on steady compounding than a repeat of earlier acceleration.

For investors weighing the bullish case, this trailing EPS path suggests the story is about maintaining mid teens type earnings growth rather than repeating the faster five year trend. This makes future quarters important checkpoints for whether those margin and EPS targets still look realistic. 🐂 Merit Medical Systems Bull Case

Premium P/E and DCF gap put valuation in focus

• At a share price of US$62.01, the stock trades on a P/E of 26.5x compared with a DCF fair value of US$88.24 and an analyst price target reference of US$90.64, while the P/E sits above the US Medical Equipment industry average of 23.8x and a peer average of 22.9x.
• What stands out is how this valuation profile fits with the concerns in the bearish narrative that current multiples already bake in healthy progress, even with the stock trading about 29.7% below the DCF fair value:
  • Earnings grew 14% over the last year, which is below the five year 27% annual pace and below the broader US market earnings growth forecast of 15.8%, so critics question whether a 26.5x P/E is justified if growth tracks closer to the roughly 12.4% consensus for the near term.
  • Revenue is forecast to grow around 5.7% per year compared with an 11% forecast for the wider US market, and bears argue that slower revenue growth plus a premium P/E means the US$62.01 price already assumes that the company will deliver on margin targets without major setbacks.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Merit Medical Systems on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

If the mix of bullish and bearish views here feels finely balanced, use it as a prompt to look at the data yourself and decide quickly where you stand. To see what the optimism is built on, review the 3 key rewards.

See What Else Is Out There

Revenue growth sits in the mid single digit range while the P/E of 26.5x is above peers, which raises questions about paying up for slower expansion.

If you are questioning a premium price tied to moderate growth, compare this setup with companies in the 51 high quality undervalued stocks to quickly spot alternatives that look cheaper on fundamentals.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.