MERCK & CO. INC. (6MK.DE) Stock Fundamental Analysis
FRA:6MK - Deutsche Boerse Ag - US58933Y1055 - Common Stock - Currency: EUR
Taking everything into account, 6MK scores 6 out of 10 in our fundamental rating. 6MK was compared to 52 industry peers in the Pharmaceuticals industry. While 6MK belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on 6MK. This makes 6MK very considerable for value investing!
1. Profitability
1.1 Basic Checks
In the past year 6MK was profitable.
6MK had a positive operating cash flow in the past year.
6MK had positive earnings in each of the past 5 years.
In the past 5 years 6MK always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 10.34%, 6MK belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
6MK's Return On Equity of 27.30% is amongst the best of the industry. 6MK outperforms 85.42% of its industry peers.
With a decent Return On Invested Capital value of 13.36%, 6MK is doing good in the industry, outperforming 72.92% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for 6MK is below the industry average of 12.45%.
The last Return On Invested Capital (13.36%) for 6MK is above the 3 year average (8.66%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.34% | ||
| ROE | 27.3% | ||
| ROIC | 13.36% |
ROA(3y)8.66%
ROA(5y)9.07%
ROE(3y)22.24%
ROE(5y)26.52%
ROIC(3y)8.66%
ROIC(5y)8.79%
1.3 Margins
The Profit Margin of 6MK (19.23%) is better than 85.42% of its industry peers.
In the last couple of years the Profit Margin of 6MK has declined.
With an excellent Operating Margin value of 34.34%, 6MK belongs to the best of the industry, outperforming 89.58% of the companies in the same industry.
6MK's Operating Margin has declined in the last couple of years.
With a decent Gross Margin value of 76.59%, 6MK is doing good in the industry, outperforming 77.08% of the companies in the same industry.
In the last couple of years the Gross Margin of 6MK has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.34% | ||
| PM (TTM) | 19.23% | ||
| GM | 76.59% |
OM growth 3Y-36.42%
OM growth 5Y-24.03%
PM growth 3Y-67.08%
PM growth 5Y-47.14%
GM growth 3Y0.65%
GM growth 5Y1.25%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), 6MK is creating some value.
The number of shares outstanding for 6MK has been reduced compared to 1 year ago.
The number of shares outstanding for 6MK has been reduced compared to 5 years ago.
The debt/assets ratio for 6MK is higher compared to a year ago.
2.2 Solvency
6MK has an Altman-Z score of 3.83. This indicates that 6MK is financially healthy and has little risk of bankruptcy at the moment.
6MK has a Altman-Z score (3.83) which is in line with its industry peers.
6MK has a debt to FCF ratio of 2.57. This is a good value and a sign of high solvency as 6MK would need 2.57 years to pay back of all of its debts.
6MK has a Debt to FCF ratio of 2.57. This is in the better half of the industry: 6MK outperforms 77.08% of its industry peers.
A Debt/Equity ratio of 0.79 indicates that 6MK is somewhat dependend on debt financing.
6MK has a worse Debt to Equity ratio (0.79) than 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 2.57 | ||
| Altman-Z | 3.83 |
ROIC/WACC1.5
WACC8.93%
2.3 Liquidity
A Current Ratio of 1.36 indicates that 6MK should not have too much problems paying its short term obligations.
6MK's Current ratio of 1.36 is in line compared to the rest of the industry. 6MK outperforms 45.83% of its industry peers.
6MK has a Quick Ratio of 1.15. This is a normal value and indicates that 6MK is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of 6MK (1.15) is better than 64.58% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.15 |
3. Growth
3.1 Past
6MK shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 92.56%, which is quite impressive.
6MK shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -19.14% yearly.
The Revenue has been growing slightly by 6.51% in the past year.
The Revenue has been growing slightly by 7.29% on average over the past years.
EPS 1Y (TTM)92.56%
EPS 3Y-36.76%
EPS 5Y-19.14%
EPS Q2Q%-26.29%
Revenue 1Y (TTM)6.51%
Revenue growth 3Y13.13%
Revenue growth 5Y7.29%
Sales Q2Q%4.35%
3.2 Future
The Earnings Per Share is expected to grow by 50.14% on average over the next years. This is a very strong growth
6MK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.17% yearly.
EPS Next Y406.8%
EPS Next 2Y144.11%
EPS Next 3Y90.9%
EPS Next 5Y50.14%
Revenue Next Year6.67%
Revenue Next 2Y5.95%
Revenue Next 3Y6.05%
Revenue Next 5Y5.17%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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
The Price/Earnings ratio is 15.16, which indicates a correct valuation of 6MK.
Based on the Price/Earnings ratio, 6MK is valued a bit cheaper than 77.08% of the companies in the same industry.
6MK's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.47.
The Price/Forward Earnings ratio is 10.09, which indicates a very decent valuation of 6MK.
Based on the Price/Forward Earnings ratio, 6MK is valued cheaper than 85.42% of the companies in the same industry.
6MK's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 92.74.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.16 | ||
| Fwd PE | 10.09 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 6MK is valued a bit cheaper than 79.17% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, 6MK is valued a bit cheaper than the industry average as 79.17% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.38 | ||
| EV/EBITDA | 9.54 |
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.
6MK has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as 6MK's earnings are expected to grow with 90.90% in the coming years.
PEG (NY)0.04
PEG (5Y)N/A
EPS Next 2Y144.11%
EPS Next 3Y90.9%
5. Dividend
5.1 Amount
6MK has a Yearly Dividend Yield of 3.27%.
Compared to an average industry Dividend Yield of 2.69, 6MK pays a bit more dividend than its industry peers.
6MK's Dividend Yield is a higher than the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.27% |
5.2 History
The dividend of 6MK is nicely growing with an annual growth rate of 8.47%!
Dividend Growth(5Y)8.47%
Div Incr Years8
Div Non Decr Years8
5.3 Sustainability
63.72% of the earnings are spent on dividend by 6MK. This is not a sustainable payout ratio.
6MK's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP63.72%
EPS Next 2Y144.11%
EPS Next 3Y90.9%
MERCK & CO. INC.
FRA:6MK (2/5/2025, 2:38:41 PM)
87.3
+1.6 (+1.87%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners79.13%
Inst Owner ChangeN/A
Ins Owners0.04%
Ins Owner ChangeN/A
Market Cap220.84B
Analysts79.38
Price Target120.87 (38.45%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.27% |
Yearly Dividend2.94
Dividend Growth(5Y)8.47%
DP63.72%
Div Incr Years8
Div Non Decr Years8
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.07%
Min EPS beat(2)3.35%
Max EPS beat(2)4.78%
EPS beat(4)4
Avg EPS beat(4)36.16%
Min EPS beat(4)3.35%
Max EPS beat(4)127.21%
EPS beat(8)8
Avg EPS beat(8)21.03%
EPS beat(12)12
Avg EPS beat(12)18.06%
EPS beat(16)13
Avg EPS beat(16)12.99%
Revenue beat(2)2
Avg Revenue beat(2)0.46%
Min Revenue beat(2)0.2%
Max Revenue beat(2)0.71%
Revenue beat(4)3
Avg Revenue beat(4)0.9%
Min Revenue beat(4)-0.09%
Max Revenue beat(4)2.78%
Revenue beat(8)7
Avg Revenue beat(8)1.76%
Revenue beat(12)11
Avg Revenue beat(12)2.68%
Revenue beat(16)13
Avg Revenue beat(16)0.5%
PT rev (1m)-5.16%
PT rev (3m)-6.52%
EPS NQ rev (1m)-13.47%
EPS NQ rev (3m)-23.98%
EPS NY rev (1m)-2.95%
EPS NY rev (3m)-2.79%
Revenue NQ rev (1m)-0.31%
Revenue NQ rev (3m)-3.04%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.16 | ||
| Fwd PE | 10.09 | ||
| P/S | 3.61 | ||
| P/FCF | 15.38 | ||
| P/OCF | 12.5 | ||
| P/B | 5.13 | ||
| P/tB | 39.38 | ||
| EV/EBITDA | 9.54 |
EPS(TTM)5.76
EY6.6%
EPS(NY)8.65
Fwd EY9.91%
FCF(TTM)5.68
FCFY6.5%
OCF(TTM)6.99
OCFY8%
SpS24.16
BVpS17.02
TBVpS2.22
PEG (NY)0.04
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.34% | ||
| ROE | 27.3% | ||
| ROCE | 24.67% | ||
| ROIC | 13.36% | ||
| ROICexc | 16.02% | ||
| ROICexgc | 33.91% | ||
| OM | 34.34% | ||
| PM (TTM) | 19.23% | ||
| GM | 76.59% | ||
| FCFM | 23.49% |
ROA(3y)8.66%
ROA(5y)9.07%
ROE(3y)22.24%
ROE(5y)26.52%
ROIC(3y)8.66%
ROIC(5y)8.79%
ROICexc(3y)9.91%
ROICexc(5y)10.17%
ROICexgc(3y)23.75%
ROICexgc(5y)25.82%
ROCE(3y)15.99%
ROCE(5y)16.24%
ROICexcg growth 3Y-38.8%
ROICexcg growth 5Y-25.67%
ROICexc growth 3Y-34.34%
ROICexc growth 5Y-24.16%
OM growth 3Y-36.42%
OM growth 5Y-24.03%
PM growth 3Y-67.08%
PM growth 5Y-47.14%
GM growth 3Y0.65%
GM growth 5Y1.25%
F-Score7
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.79 | ||
| Debt/FCF | 2.57 | ||
| Debt/EBITDA | 1.35 | ||
| Cap/Depr | 80.26% | ||
| Cap/Sales | 5.42% | ||
| Interest Coverage | 17.44 | ||
| Cash Conversion | 70.35% | ||
| Profit Quality | 122.16% | ||
| Current Ratio | 1.36 | ||
| Quick Ratio | 1.15 | ||
| Altman-Z | 3.83 |
F-Score7
WACC8.93%
ROIC/WACC1.5
Cap/Depr(3y)116.81%
Cap/Depr(5y)114.51%
Cap/Sales(3y)7.65%
Cap/Sales(5y)8.5%
Profit Quality(3y)893.42%
Profit Quality(5y)572.79%
High Growth Momentum
Growth
EPS 1Y (TTM)92.56%
EPS 3Y-36.76%
EPS 5Y-19.14%
EPS Q2Q%-26.29%
EPS Next Y406.8%
EPS Next 2Y144.11%
EPS Next 3Y90.9%
EPS Next 5Y50.14%
Revenue 1Y (TTM)6.51%
Revenue growth 3Y13.13%
Revenue growth 5Y7.29%
Sales Q2Q%4.35%
Revenue Next Year6.67%
Revenue Next 2Y5.95%
Revenue Next 3Y6.05%
Revenue Next 5Y5.17%
EBIT growth 1Y4.37%
EBIT growth 3Y-28.07%
EBIT growth 5Y-18.5%
EBIT Next Year337.7%
EBIT Next 3Y77.42%
EBIT Next 5Y44.91%
FCF growth 1Y-2.68%
FCF growth 3Y16.22%
FCF growth 5Y1.94%
OCF growth 1Y-7.27%
OCF growth 3Y8.25%
OCF growth 5Y3.55%