MERCK KGAA (1MRK.MI) Stock Fundamental Analysis
BIT:1MRK - Euronext Milan - DE0006599905 - Common Stock - Currency: EUR
1MRK gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 51 industry peers in the Pharmaceuticals industry. Both the profitability and the financial health of 1MRK get a neutral evaluation. Nothing too spectacular is happening here. 1MRK has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
1MRK had positive earnings in the past year.
1MRK had a positive operating cash flow in the past year.
In the past 5 years 1MRK has always been profitable.
Each year in the past 5 years 1MRK had a positive operating cash flow.
1.2 Ratios
1MRK has a Return On Assets (5.38%) which is comparable to the rest of the industry.
The Return On Equity of 1MRK (9.28%) is comparable to the rest of the industry.
1MRK has a Return On Invested Capital (7.26%) which is comparable to the rest of the industry.
1MRK had an Average Return On Invested Capital over the past 3 years of 9.28%. This is significantly below the industry average of 14.91%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.38% | ||
| ROE | 9.28% | ||
| ROIC | 7.26% |
ROA(3y)6.02%
ROA(5y)5.91%
ROE(3y)10.9%
ROE(5y)11.75%
ROIC(3y)9.28%
ROIC(5y)9.07%
1.3 Margins
1MRK's Profit Margin of 13.12% is fine compared to the rest of the industry. 1MRK outperforms 72.55% of its industry peers.
1MRK's Profit Margin has improved in the last couple of years.
1MRK's Operating Margin of 17.26% is in line compared to the rest of the industry. 1MRK outperforms 52.94% of its industry peers.
In the last couple of years the Operating Margin of 1MRK has grown nicely.
1MRK has a worse Gross Margin (59.01%) than 64.71% of its industry peers.
In the last couple of years the Gross Margin of 1MRK has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.26% | ||
| PM (TTM) | 13.12% | ||
| GM | 59.01% |
OM growth 3Y-2.38%
OM growth 5Y5.83%
PM growth 3Y-5.43%
PM growth 5Y9.94%
GM growth 3Y-1.81%
GM growth 5Y-1.2%
2. Health
2.1 Basic Checks
1MRK has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
1MRK has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for 1MRK remains at a similar level compared to 5 years ago.
1MRK has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.91 indicates that 1MRK is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.91, 1MRK perfoms like the industry average, outperforming 56.86% of the companies in the same industry.
1MRK has a debt to FCF ratio of 4.28. This is a neutral value as 1MRK would need 4.28 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 4.28, 1MRK is doing good in the industry, outperforming 60.78% of the companies in the same industry.
A Debt/Equity ratio of 0.23 indicates that 1MRK is not too dependend on debt financing.
1MRK has a better Debt to Equity ratio (0.23) than 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 4.28 | ||
| Altman-Z | 2.91 |
ROIC/WACC1.06
WACC6.83%
2.3 Liquidity
1MRK has a Current Ratio of 1.19. This is a normal value and indicates that 1MRK is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.19, 1MRK is doing worse than 60.78% of the companies in the same industry.
A Quick Ratio of 0.79 indicates that 1MRK may have some problems paying its short term obligations.
1MRK has a Quick ratio of 0.79. This is in the lower half of the industry: 1MRK underperforms 64.71% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.19 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 1.77% over the past year.
The Earnings Per Share has been growing by 9.19% on average over the past years. This is quite good.
Looking at the last year, 1MRK shows a small growth in Revenue. The Revenue has grown by 0.78% in the last year.
Measured over the past years, 1MRK shows a small growth in Revenue. The Revenue has been growing by 5.55% on average per year.
EPS 1Y (TTM)1.77%
EPS 3Y-0.35%
EPS 5Y9.19%
EPS Q2Q%11.89%
Revenue 1Y (TTM)0.78%
Revenue growth 3Y2.43%
Revenue growth 5Y5.55%
Sales Q2Q%3.7%
3.2 Future
Based on estimates for the next years, 1MRK will show a small growth in Earnings Per Share. The EPS will grow by 7.50% on average per year.
The Revenue is expected to grow by 4.14% on average over the next years.
EPS Next Y8.35%
EPS Next 2Y8.91%
EPS Next 3Y7.86%
EPS Next 5Y7.5%
Revenue Next Year4.01%
Revenue Next 2Y4%
Revenue Next 3Y3.79%
Revenue Next 5Y4.14%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 13.70, which indicates a correct valuation of 1MRK.
Based on the Price/Earnings ratio, 1MRK is valued a bit cheaper than 72.55% of the companies in the same industry.
1MRK's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 28.78.
A Price/Forward Earnings ratio of 12.64 indicates a correct valuation of 1MRK.
Compared to the rest of the industry, the Price/Forward Earnings ratio of 1MRK indicates a somewhat cheap valuation: 1MRK is cheaper than 68.63% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.32. 1MRK is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.7 | ||
| Fwd PE | 12.64 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 1MRK indicates a somewhat cheap valuation: 1MRK is cheaper than 60.78% of the companies listed in the same industry.
62.75% of the companies in the same industry are more expensive than 1MRK, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.4 | ||
| EV/EBITDA | 10 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.64
PEG (5Y)1.49
EPS Next 2Y8.91%
EPS Next 3Y7.86%
5. Dividend
5.1 Amount
1MRK has a Yearly Dividend Yield of 1.84%.
1MRK's Dividend Yield is comparable with the industry average which is at 3.13.
Compared to the average S&P500 Dividend Yield of 2.46, 1MRK is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.84% |
5.2 History
The dividend of 1MRK is nicely growing with an annual growth rate of 11.88%!
Dividend Growth(5Y)11.88%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
10.23% of the earnings are spent on dividend by 1MRK. This is a low number and sustainable payout ratio.
1MRK's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP10.23%
EPS Next 2Y8.91%
EPS Next 3Y7.86%
BIT:1MRK (4/22/2025, 7:00:00 PM)
118.2
+0.2 (+0.17%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners54.58%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap51.39B
Analysts80.83
Price Target174.24 (47.41%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.84% |
Yearly Dividend0.65
Dividend Growth(5Y)11.88%
DP10.23%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.48%
Min EPS beat(2)-2.56%
Max EPS beat(2)-0.39%
EPS beat(4)2
Avg EPS beat(4)4.19%
Min EPS beat(4)-2.56%
Max EPS beat(4)10.63%
EPS beat(8)3
Avg EPS beat(8)1.62%
EPS beat(12)6
Avg EPS beat(12)0.89%
EPS beat(16)8
Avg EPS beat(16)2.24%
Revenue beat(2)0
Avg Revenue beat(2)-1.39%
Min Revenue beat(2)-2.1%
Max Revenue beat(2)-0.68%
Revenue beat(4)1
Avg Revenue beat(4)-0.88%
Min Revenue beat(4)-2.1%
Max Revenue beat(4)0.28%
Revenue beat(8)1
Avg Revenue beat(8)-1.3%
Revenue beat(12)3
Avg Revenue beat(12)-0.96%
Revenue beat(16)5
Avg Revenue beat(16)-0.72%
PT rev (1m)-6.94%
PT rev (3m)-6.1%
EPS NQ rev (1m)-0.77%
EPS NQ rev (3m)-1.67%
EPS NY rev (1m)-0.92%
EPS NY rev (3m)-5.48%
Revenue NQ rev (1m)-0.07%
Revenue NQ rev (3m)0.04%
Revenue NY rev (1m)-0.76%
Revenue NY rev (3m)-0.53%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.7 | ||
| Fwd PE | 12.64 | ||
| P/S | 2.43 | ||
| P/FCF | 21.4 | ||
| P/OCF | 11.21 | ||
| P/B | 1.72 | ||
| P/tB | 11.47 | ||
| EV/EBITDA | 10 |
EPS(TTM)8.63
EY7.3%
EPS(NY)9.35
Fwd EY7.91%
FCF(TTM)5.52
FCFY4.67%
OCF(TTM)10.55
OCFY8.92%
SpS48.66
BVpS68.8
TBVpS10.3
PEG (NY)1.64
PEG (5Y)1.49
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.38% | ||
| ROE | 9.28% | ||
| ROCE | 9.07% | ||
| ROIC | 7.26% | ||
| ROICexc | 7.88% | ||
| ROICexgc | 25.03% | ||
| OM | 17.26% | ||
| PM (TTM) | 13.12% | ||
| GM | 59.01% | ||
| FCFM | 11.35% |
ROA(3y)6.02%
ROA(5y)5.91%
ROE(3y)10.9%
ROE(5y)11.75%
ROIC(3y)9.28%
ROIC(5y)9.07%
ROICexc(3y)9.79%
ROICexc(5y)9.49%
ROICexgc(3y)29.91%
ROICexgc(5y)31.66%
ROCE(3y)11.59%
ROCE(5y)11.34%
ROICexcg growth 3Y-8.23%
ROICexcg growth 5Y-5.36%
ROICexc growth 3Y-3.27%
ROICexc growth 5Y7.94%
OM growth 3Y-2.38%
OM growth 5Y5.83%
PM growth 3Y-5.43%
PM growth 5Y9.94%
GM growth 3Y-1.81%
GM growth 5Y-1.2%
F-Score4
Asset Turnover0.41
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 4.28 | ||
| Debt/EBITDA | 1.21 | ||
| Cap/Depr | 102.34% | ||
| Cap/Sales | 10.32% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 79.26% | ||
| Profit Quality | 86.53% | ||
| Current Ratio | 1.19 | ||
| Quick Ratio | 0.79 | ||
| Altman-Z | 2.91 |
F-Score4
WACC6.83%
ROIC/WACC1.06
Cap/Depr(3y)99.64%
Cap/Depr(5y)92.04%
Cap/Sales(3y)9.36%
Cap/Sales(5y)8.84%
Profit Quality(3y)74.2%
Profit Quality(5y)84.7%
High Growth Momentum
Growth
EPS 1Y (TTM)1.77%
EPS 3Y-0.35%
EPS 5Y9.19%
EPS Q2Q%11.89%
EPS Next Y8.35%
EPS Next 2Y8.91%
EPS Next 3Y7.86%
EPS Next 5Y7.5%
Revenue 1Y (TTM)0.78%
Revenue growth 3Y2.43%
Revenue growth 5Y5.55%
Sales Q2Q%3.7%
Revenue Next Year4.01%
Revenue Next 2Y4%
Revenue Next 3Y3.79%
Revenue Next 5Y4.14%
EBIT growth 1Y-0.19%
EBIT growth 3Y-0.01%
EBIT growth 5Y11.7%
EBIT Next Year44.88%
EBIT Next 3Y17.71%
EBIT Next 5Y12.45%
FCF growth 1Y36.4%
FCF growth 3Y-9.07%
FCF growth 5Y5.53%
OCF growth 1Y21.19%
OCF growth 3Y-0.22%
OCF growth 5Y9.93%