MERCK & CO. INC. (1MRKX.MI) Stock Fundamental Analysis
BIT:1MRKX - Euronext Milan - US58933Y1055 - Common Stock - Currency: EUR
We assign a fundamental rating of 7 out of 10 to 1MRKX. 1MRKX was compared to 50 industry peers in the Pharmaceuticals industry. 1MRKX scores excellent points on both the profitability and health parts. This is a solid base for a good stock. A decent growth rate in combination with a cheap valuation! Better keep an eye on 1MRKX. Finally 1MRKX also has an excellent dividend rating. This makes 1MRKX very considerable for value and dividend and quality investing!
1. Profitability
1.1 Basic Checks
1MRKX had positive earnings in the past year.
In the past year 1MRKX had a positive cash flow from operations.
Each year in the past 5 years 1MRKX has been profitable.
Each year in the past 5 years 1MRKX had a positive operating cash flow.
1.2 Ratios
The Return On Assets of 1MRKX (15.14%) is better than 90.00% of its industry peers.
1MRKX's Return On Equity of 36.07% is amongst the best of the industry. 1MRKX outperforms 86.00% of its industry peers.
With a decent Return On Invested Capital value of 12.73%, 1MRKX is doing good in the industry, outperforming 64.00% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for 1MRKX is in line with the industry average of 14.75%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.14% | ||
| ROE | 36.07% | ||
| ROIC | 12.73% |
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 27.27%. This is amongst the best in the industry. 1MRKX outperforms 92.00% of its industry peers.
1MRKX's Profit Margin has been stable in the last couple of years.
1MRKX has a Operating Margin of 33.84%. This is amongst the best in the industry. 1MRKX outperforms 88.00% of its industry peers.
In the last couple of years the Operating Margin of 1MRKX has grown nicely.
With a decent Gross Margin value of 78.17%, 1MRKX is doing good in the industry, outperforming 74.00% 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 | 33.84% | ||
| PM (TTM) | 27.27% | ||
| GM | 78.17% |
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), 1MRKX is creating some value.
The number of shares outstanding for 1MRKX remains at a similar level compared to 1 year ago.
1MRKX has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, 1MRKX has an improved debt to assets ratio.
2.2 Solvency
1MRKX has an Altman-Z score of 3.86. This indicates that 1MRKX is financially healthy and has little risk of bankruptcy at the moment.
1MRKX has a Altman-Z score (3.86) which is comparable to the rest of the industry.
The Debt to FCF ratio of 1MRKX is 2.04, which is a good value as it means it would take 1MRKX, 2.04 years of fcf income to pay off all of its debts.
1MRKX has a better Debt to FCF ratio (2.04) than 86.00% of its industry peers.
1MRKX has a Debt/Equity ratio of 0.69. This is a neutral value indicating 1MRKX is somewhat dependend on debt financing.
1MRKX has a Debt to Equity ratio (0.69) which is comparable to the rest of the 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 | 0.69 | ||
| Debt/FCF | 2.04 | ||
| Altman-Z | 3.86 |
ROIC/WACC1.43
WACC8.88%
2.3 Liquidity
1MRKX has a Current Ratio of 1.41. This is a normal value and indicates that 1MRKX is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.41, 1MRKX is in line with its industry, outperforming 56.00% of the companies in the same industry.
1MRKX has a Quick Ratio of 1.16. This is a normal value and indicates that 1MRKX is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of 1MRKX (1.16) is better than 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.41 | ||
| Quick Ratio | 1.16 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 258.99% 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 4.10% 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)258.99%
EPS 3Y6.87%
EPS 5Y8.04%
EPS Q2Q%7.25%
Revenue 1Y (TTM)4.1%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%-1.56%
3.2 Future
Based on estimates for the next years, 1MRKX will show a small growth in Earnings Per Share. The EPS will grow by 5.96% on average per year.
The Revenue is expected to grow by 2.20% on average over the next years.
EPS Next Y17.71%
EPS Next 2Y13.67%
EPS Next 3Y12.76%
EPS Next 5Y5.96%
Revenue Next Year1.67%
Revenue Next 2Y3.7%
Revenue Next 3Y4.26%
Revenue Next 5Y2.2%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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
With a Price/Earnings ratio of 10.50, the valuation of 1MRKX can be described as very reasonable.
1MRKX's Price/Earnings ratio is a bit cheaper when compared to the industry. 1MRKX is cheaper than 78.00% of the companies in the same industry.
1MRKX's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.21.
With a Price/Forward Earnings ratio of 8.29, the valuation of 1MRKX can be described as very reasonable.
84.00% of the companies in the same industry are more expensive than 1MRKX, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.70, 1MRKX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.5 | ||
| Fwd PE | 8.29 |
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 72.00% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of 1MRKX indicates a rather cheap valuation: 1MRKX is cheaper than 84.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.06 | ||
| EV/EBITDA | 8.48 |
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.
A more expensive valuation may be justified as 1MRKX's earnings are expected to grow with 12.76% in the coming years.
PEG (NY)0.59
PEG (5Y)1.31
EPS Next 2Y13.67%
EPS Next 3Y12.76%
5. Dividend
5.1 Amount
1MRKX has a Yearly Dividend Yield of 4.11%, which is a nice return.
In the last 3 months the price of 1MRKX has falen by -43.25%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
1MRKX's Dividend Yield is a higher than the industry average which is at 3.03.
1MRKX's Dividend Yield is rather good when compared to the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.11% |
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 Years0
Div Non Decr Years0
5.3 Sustainability
1MRKX pays out 45.54% of its income as dividend. This is a bit on the high side, but may be sustainable.
1MRKX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP45.54%
EPS Next 2Y13.67%
EPS Next 3Y12.76%
BIT:1MRKX (7/1/2025, 7:00:00 PM)
69.8
+2.7 (+4.02%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners80.57%
Inst Owner ChangeN/A
Ins Owners0.05%
Ins Owner ChangeN/A
Market Cap175.27B
Analysts76.88
Price Target92.02 (31.83%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.11% |
Yearly Dividend2.65
Dividend Growth(5Y)6.9%
DP45.54%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.19%
Min EPS beat(2)2.93%
Max EPS beat(2)5.44%
EPS beat(4)4
Avg EPS beat(4)4.13%
Min EPS beat(4)2.93%
Max EPS beat(4)5.44%
EPS beat(8)8
Avg EPS beat(8)20.93%
EPS beat(12)12
Avg EPS beat(12)16.06%
EPS beat(16)15
Avg EPS beat(16)14.76%
Revenue beat(2)1
Avg Revenue beat(2)0.18%
Min Revenue beat(2)-0.1%
Max Revenue beat(2)0.45%
Revenue beat(4)3
Avg Revenue beat(4)0.32%
Min Revenue beat(4)-0.1%
Max Revenue beat(4)0.71%
Revenue beat(8)6
Avg Revenue beat(8)1.27%
Revenue beat(12)10
Avg Revenue beat(12)1.96%
Revenue beat(16)14
Avg Revenue beat(16)2.49%
PT rev (1m)-3.05%
PT rev (3m)-17.78%
EPS NQ rev (1m)0.8%
EPS NQ rev (3m)-7.26%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)-0.86%
Revenue NQ rev (1m)-0.07%
Revenue NQ rev (3m)-1.75%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.16%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.5 | ||
| Fwd PE | 8.29 | ||
| P/S | 3.21 | ||
| P/FCF | 12.06 | ||
| P/OCF | 9.84 | ||
| P/B | 4.25 | ||
| P/tB | 18.86 | ||
| EV/EBITDA | 8.48 |
EPS(TTM)6.65
EY9.53%
EPS(NY)8.42
Fwd EY12.07%
FCF(TTM)5.79
FCFY8.29%
OCF(TTM)7.09
OCFY10.16%
SpS21.72
BVpS16.42
TBVpS3.7
PEG (NY)0.59
PEG (5Y)1.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.14% | ||
| ROE | 36.07% | ||
| ROCE | 24.05% | ||
| ROIC | 12.73% | ||
| ROICexc | 14.19% | ||
| ROICexgc | 26.46% | ||
| OM | 33.84% | ||
| PM (TTM) | 27.27% | ||
| GM | 78.17% | ||
| FCFM | 26.66% |
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 Turnover0.56
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.69 | ||
| Debt/FCF | 2.04 | ||
| Debt/EBITDA | 1.28 | ||
| Cap/Depr | 83.2% | ||
| Cap/Sales | 6.01% | ||
| Interest Coverage | 16.44 | ||
| Cash Conversion | 79.55% | ||
| Profit Quality | 97.73% | ||
| Current Ratio | 1.41 | ||
| Quick Ratio | 1.16 | ||
| Altman-Z | 3.86 |
F-Score8
WACC8.88%
ROIC/WACC1.43
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)258.99%
EPS 3Y6.87%
EPS 5Y8.04%
EPS Q2Q%7.25%
EPS Next Y17.71%
EPS Next 2Y13.67%
EPS Next 3Y12.76%
EPS Next 5Y5.96%
Revenue 1Y (TTM)4.1%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%-1.56%
Revenue Next Year1.67%
Revenue Next 2Y3.7%
Revenue Next 3Y4.26%
Revenue Next 5Y2.2%
EBIT growth 1Y-3.79%
EBIT growth 3Y14.48%
EBIT growth 5Y18.33%
EBIT Next Year30.08%
EBIT Next 3Y15.02%
EBIT Next 5Y9.31%
FCF growth 1Y51.3%
FCF growth 3Y23.27%
FCF growth 5Y12.67%
OCF growth 1Y33.21%
OCF growth 3Y15.02%
OCF growth 5Y9.82%