Is NYSE:MRK a Good Fit for Dividend Investing?

Our stock screener has spotted MERCK & CO. INC. (NYSE:MRK) as a good dividend stock with solid fundamentals. NYSE:MRK shows decent health and profitability. At the same time it gives a good and sustainable dividend. We'll dive into each aspect below.

Evaluating Dividend: NYSE:MRK

ChartMill provides a Dividend Rating for every stock, ranging from 0 to 10. This rating assesses various dividend aspects, including yield, growth, and sustainability. NYSE:MRK earns a 8 out of 10:

• Compared to an average industry Dividend Yield of 3.84, MRK pays a better dividend. On top of this MRK pays more dividend than 92.78% of the companies listed in the same industry.
• MRK's Dividend Yield is a higher than the S&P500 average which is at 2.22.
• On average, the dividend of MRK grows each year by 8.47%, which is quite nice.
• MRK has paid a dividend for at least 10 years, which is a reliable track record.
• MRK has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
• MRK's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Unpacking NYSE:MRK's Health Rating

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NYSE:MRK has earned a 6 out of 10:

• An Altman-Z score of 4.37 indicates that MRK is not in any danger for bankruptcy at the moment.
• The Altman-Z score of MRK (4.37) is better than 76.80% of its industry peers.
• MRK has a debt to FCF ratio of 2.87. This is a good value and a sign of high solvency as MRK would need 2.87 years to pay back of all of its debts.
• MRK has a Debt to FCF ratio of 2.87. This is amongst the best in the industry. MRK outperforms 91.75% of its industry peers.

What does the Profitability looks like for NYSE:MRK

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NYSE:MRK has achieved a 8:

• MRK has a Return On Assets of 12.20%. This is amongst the best in the industry. MRK outperforms 94.85% of its industry peers.
• MRK has a better Return On Equity (31.52%) than 94.85% of its industry peers.
• With an excellent Return On Invested Capital value of 16.35%, MRK belongs to the best of the industry, outperforming 93.30% of the companies in the same industry.
• The last Return On Invested Capital (16.35%) for MRK is above the 3 year average (12.63%), which is a sign of increasing profitability.
• MRK has a Profit Margin of 21.98%. This is amongst the best in the industry. MRK outperforms 93.30% of its industry peers.
• MRK has a Operating Margin of 28.68%. This is amongst the best in the industry. MRK outperforms 93.81% of its industry peers.
• MRK has a Gross Margin of 75.79%. This is amongst the best in the industry. MRK outperforms 83.51% of its industry peers.

Every day, new Best Dividend stocks can be found on ChartMill in our Best Dividend screener.

Our latest full fundamental report of MRK contains the most current fundamental analsysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.