MERCK & CO. INC. (1MRKX.MI) Stock Fundamental Analysis
BIT:1MRKX - Euronext Milan - US58933Y1055 - Common Stock - Currency: EUR
1MRKX gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 52 industry peers in the Pharmaceuticals industry. 1MRKX gets an excellent profitability rating and is at the same time showing great financial health properties. A decent growth rate in combination with a cheap valuation! Better keep an eye on 1MRKX. These ratings would make 1MRKX suitable for value and quality investing!
1. Profitability
1.1 Basic Checks
In the past year 1MRKX was profitable.
1MRKX had a positive operating cash flow in the past year.
Each year in the past 5 years 1MRKX has been profitable.
In the past 5 years 1MRKX always reported a positive cash flow from operatings.
1.2 Ratios
1MRKX has a better Return On Assets (14.62%) than 92.31% of its industry peers.
1MRKX's Return On Equity of 36.96% is amongst the best of the industry. 1MRKX outperforms 90.38% of its industry peers.
Looking at the Return On Invested Capital, with a value of 13.25%, 1MRKX is in the better half of the industry, outperforming 71.15% of the companies in the same industry.
1MRKX had an Average Return On Invested Capital over the past 3 years of 13.49%. This is in line with the industry average of 13.62%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.62% | ||
| ROE | 36.96% | ||
| ROIC | 13.25% |
ROA(3y)9.42%
ROA(5y)9.66%
ROE(3y)23.17%
ROE(5y)26.32%
ROIC(3y)13.49%
ROIC(5y)11.91%
1.3 Margins
1MRKX has a Profit Margin of 26.68%. This is amongst the best in the industry. 1MRKX outperforms 92.31% of its industry peers.
In the last couple of years the Profit Margin of 1MRKX has remained more or less at the same level.
The Operating Margin of 1MRKX (34.59%) is better than 90.38% of its industry peers.
1MRKX's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 78.19%, 1MRKX is in the better half of the industry, outperforming 78.85% of the companies in the same industry.
In the last couple of years the Gross Margin of 1MRKX has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.59% | ||
| PM (TTM) | 26.68% | ||
| GM | 78.19% |
OM growth 3Y4.43%
OM growth 5Y7.18%
PM growth 3Y-0.15%
PM growth 5Y1.18%
GM growth 3Y3.55%
GM growth 5Y2.42%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so 1MRKX is still creating some value.
1MRKX has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for 1MRKX has been reduced compared to 5 years ago.
The debt/assets ratio for 1MRKX has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.07 indicates that 1MRKX is not in any danger for bankruptcy at the moment.
1MRKX has a better Altman-Z score (4.07) than 69.23% of its industry peers.
1MRKX has a debt to FCF ratio of 2.05. This is a good value and a sign of high solvency as 1MRKX would need 2.05 years to pay back of all of its debts.
1MRKX has a better Debt to FCF ratio (2.05) than 84.62% of its industry peers.
1MRKX has a Debt/Equity ratio of 0.74. This is a neutral value indicating 1MRKX is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.74, 1MRKX perfoms like the industry average, outperforming 44.23% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for 1MRKX, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 2.05 | ||
| Altman-Z | 4.07 |
ROIC/WACC1.46
WACC9.09%
2.3 Liquidity
A Current Ratio of 1.36 indicates that 1MRKX should not have too much problems paying its short term obligations.
With a Current ratio value of 1.36, 1MRKX perfoms like the industry average, outperforming 51.92% of the companies in the same industry.
1MRKX has a Quick Ratio of 1.15. This is a normal value and indicates that 1MRKX is financially healthy and should not expect problems in meeting its short term obligations.
1MRKX has a better Quick ratio (1.15) than 69.23% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.15 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 409.33% over the past year.
The Earnings Per Share has been growing by 8.04% on average over the past years. This is quite good.
The Revenue has been growing slightly by 6.74% in the past year.
1MRKX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.40% yearly.
EPS 1Y (TTM)409.33%
EPS 3Y6.87%
EPS 5Y8.04%
EPS Q2Q%5633.33%
Revenue 1Y (TTM)6.74%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%6.79%
3.2 Future
The Earnings Per Share is expected to grow by 6.10% on average over the next years.
1MRKX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.92% yearly.
EPS Next Y18.73%
EPS Next 2Y13.99%
EPS Next 3Y12.83%
EPS Next 5Y6.1%
Revenue Next Year1.84%
Revenue Next 2Y4.13%
Revenue Next 3Y4.71%
Revenue Next 5Y2.92%
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 decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 12.47, 1MRKX is valued correctly.
1MRKX's Price/Earnings ratio is rather cheap when compared to the industry. 1MRKX is cheaper than 86.54% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 29.35. 1MRKX is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 10.51, the valuation of 1MRKX can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of 1MRKX indicates a rather cheap valuation: 1MRKX is cheaper than 80.77% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of 1MRKX to the average of the S&P500 Index (22.10), we can say 1MRKX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.47 | ||
| Fwd PE | 10.51 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 1MRKX indicates a somewhat cheap valuation: 1MRKX is cheaper than 73.08% of the companies listed in the same industry.
82.69% of the companies in the same industry are more expensive than 1MRKX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.31 | ||
| EV/EBITDA | 9.88 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of 1MRKX may justify a higher PE ratio.
1MRKX's earnings are expected to grow with 12.83% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.67
PEG (5Y)1.55
EPS Next 2Y13.99%
EPS Next 3Y12.83%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.45%, 1MRKX has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.86, 1MRKX pays a bit more dividend than its industry peers.
1MRKX's Dividend Yield is a higher than the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.45% |
5.2 History
On average, the dividend of 1MRKX grows each year by 6.90%, which is quite nice.
Dividend Growth(5Y)6.9%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
45.80% of the earnings are spent on dividend by 1MRKX. This is a bit on the high side, but may be sustainable.
The dividend of 1MRKX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP45.8%
EPS Next 2Y13.99%
EPS Next 3Y12.83%
BIT:1MRKX (3/3/2025, 7:00:00 PM)
87.8
+0.3 (+0.34%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners79.95%
Inst Owner ChangeN/A
Ins Owners0.05%
Ins Owner ChangeN/A
Market Cap221.79B
Analysts78.62
Price Target111.92 (27.47%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.45% |
Yearly Dividend2.85
Dividend Growth(5Y)6.9%
DP45.8%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.4%
Min EPS beat(2)3.35%
Max EPS beat(2)5.44%
EPS beat(4)4
Avg EPS beat(4)5.72%
Min EPS beat(4)3.35%
Max EPS beat(4)9.3%
EPS beat(8)8
Avg EPS beat(8)21.17%
EPS beat(12)12
Avg EPS beat(12)17.11%
EPS beat(16)14
Avg EPS beat(16)13.66%
Revenue beat(2)1
Avg Revenue beat(2)0.05%
Min Revenue beat(2)-0.1%
Max Revenue beat(2)0.2%
Revenue beat(4)3
Avg Revenue beat(4)0.9%
Min Revenue beat(4)-0.1%
Max Revenue beat(4)2.78%
Revenue beat(8)6
Avg Revenue beat(8)1.72%
Revenue beat(12)10
Avg Revenue beat(12)2.52%
Revenue beat(16)13
Avg Revenue beat(16)1.4%
PT rev (1m)-7.5%
PT rev (3m)-14.29%
EPS NQ rev (1m)-1.78%
EPS NQ rev (3m)-10.64%
EPS NY rev (1m)1.48%
EPS NY rev (3m)-4.48%
Revenue NQ rev (1m)-4%
Revenue NQ rev (3m)-8.99%
Revenue NY rev (1m)-2.96%
Revenue NY rev (3m)-2.79%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.47 | ||
| Fwd PE | 10.51 | ||
| P/S | 3.75 | ||
| P/FCF | 13.31 | ||
| P/OCF | 11.22 | ||
| P/B | 5.2 | ||
| P/tB | 29.1 | ||
| EV/EBITDA | 9.88 |
EPS(TTM)7.04
EY8.02%
EPS(NY)8.36
Fwd EY9.52%
FCF(TTM)6.6
FCFY7.52%
OCF(TTM)7.83
OCFY8.92%
SpS23.4
BVpS16.89
TBVpS3.02
PEG (NY)0.67
PEG (5Y)1.55
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.62% | ||
| ROE | 36.96% | ||
| ROCE | 25.03% | ||
| ROIC | 13.25% | ||
| ROICexc | 15.67% | ||
| ROICexgc | 31.8% | ||
| OM | 34.59% | ||
| PM (TTM) | 26.68% | ||
| GM | 78.19% | ||
| FCFM | 28.2% |
ROA(3y)9.42%
ROA(5y)9.66%
ROE(3y)23.17%
ROE(5y)26.32%
ROIC(3y)13.49%
ROIC(5y)11.91%
ROICexc(3y)15.56%
ROICexc(5y)13.63%
ROICexgc(3y)33.79%
ROICexgc(5y)31.28%
ROCE(3y)25.47%
ROCE(5y)22.5%
ROICexcg growth 3Y6.23%
ROICexcg growth 5Y2.59%
ROICexc growth 3Y13.83%
ROICexc growth 5Y9.86%
OM growth 3Y4.43%
OM growth 5Y7.18%
PM growth 3Y-0.15%
PM growth 5Y1.18%
GM growth 3Y3.55%
GM growth 5Y2.42%
F-Score8
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.74 | ||
| Debt/FCF | 2.05 | ||
| Debt/EBITDA | 1.29 | ||
| Cap/Depr | 74.95% | ||
| Cap/Sales | 5.25% | ||
| Interest Coverage | 17.07 | ||
| Cash Conversion | 80.42% | ||
| Profit Quality | 105.72% | ||
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.15 | ||
| Altman-Z | 4.07 |
F-Score8
WACC9.09%
ROIC/WACC1.46
Cap/Depr(3y)95.66%
Cap/Depr(5y)110.48%
Cap/Sales(3y)6.36%
Cap/Sales(5y)7.78%
Profit Quality(3y)903.98%
Profit Quality(5y)573.68%
High Growth Momentum
Growth
EPS 1Y (TTM)409.33%
EPS 3Y6.87%
EPS 5Y8.04%
EPS Q2Q%5633.33%
EPS Next Y18.73%
EPS Next 2Y13.99%
EPS Next 3Y12.83%
EPS Next 5Y6.1%
Revenue 1Y (TTM)6.74%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%6.79%
Revenue Next Year1.84%
Revenue Next 2Y4.13%
Revenue Next 3Y4.71%
Revenue Next 5Y2.92%
EBIT growth 1Y4.93%
EBIT growth 3Y14.48%
EBIT growth 5Y18.33%
EBIT Next Year32.74%
EBIT Next 3Y17.02%
EBIT Next 5Y7.72%
FCF growth 1Y97.92%
FCF growth 3Y23.27%
FCF growth 5Y12.67%
OCF growth 1Y65.06%
OCF growth 3Y15.02%
OCF growth 5Y9.82%