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 52 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. 1MRKX is valued quite cheap, while showing a decent growth score. This is a good combination! This makes 1MRKX very considerable 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.
1MRKX had positive earnings in each of the past 5 years.
In the past 5 years 1MRKX always reported a positive cash flow from operatings.
1.2 Ratios
1MRKX's Return On Assets of 15.14% is amongst the best of the industry. 1MRKX outperforms 92.31% of its industry peers.
1MRKX has a Return On Equity of 36.07%. This is amongst the best in the industry. 1MRKX outperforms 88.46% of its industry peers.
1MRKX has a better Return On Invested Capital (12.73%) than 65.38% of its industry peers.
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 15.20%.
| 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 94.23% of its industry peers.
In the last couple of years the Profit Margin of 1MRKX has remained more or less at the same level.
1MRKX's Operating Margin of 33.84% is amongst the best of the industry. 1MRKX outperforms 90.38% of its industry peers.
In the last couple of years the Operating Margin of 1MRKX has grown nicely.
Looking at the Gross Margin, with a value of 78.17%, 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 | 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
1MRKX has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for 1MRKX remains at a similar level compared to 1 year ago.
The number of shares outstanding for 1MRKX has been reduced compared to 5 years ago.
Compared to 1 year ago, 1MRKX has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.93 indicates that 1MRKX is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.93, 1MRKX is in the better half of the industry, outperforming 61.54% of the companies in the same 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 Debt to FCF ratio of 2.04. This is amongst the best in the industry. 1MRKX outperforms 88.46% 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's Debt to Equity ratio of 0.69 is in line compared to the rest of the industry. 1MRKX outperforms 48.08% of its industry peers.
Although 1MRKX does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.69 | ||
| Debt/FCF | 2.04 | ||
| Altman-Z | 3.93 |
ROIC/WACC1.41
WACC9.04%
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 59.62% 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.
Looking at the Quick ratio, with a value of 1.16, 1MRKX is in the better half of the industry, outperforming 73.08% of the companies in the same industry.
| 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.
The Revenue has been growing by 10.40% on average over the past years. This is quite good.
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.
Based on estimates for the next years, 1MRKX will show a small growth in Revenue. The Revenue will grow by 2.20% on average per year.
EPS Next Y17.37%
EPS Next 2Y13.89%
EPS Next 3Y12.94%
EPS Next 5Y5.96%
Revenue Next Year1.51%
Revenue Next 2Y3.63%
Revenue Next 3Y4.2%
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
A Price/Earnings ratio of 10.70 indicates a reasonable valuation of 1MRKX.
1MRKX's Price/Earnings ratio is rather cheap when compared to the industry. 1MRKX is cheaper than 80.77% 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 27.35.
A Price/Forward Earnings ratio of 8.42 indicates a reasonable valuation of 1MRKX.
1MRKX's Price/Forward Earnings ratio is rather cheap when compared to the industry. 1MRKX is cheaper than 86.54% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of 1MRKX to the average of the S&P500 Index (37.54), we can say 1MRKX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.7 | ||
| Fwd PE | 8.42 |
4.2 Price Multiples
75.00% of the companies in the same industry are more expensive than 1MRKX, based on the Enterprise Value to EBITDA ratio.
86.54% 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 | 12.29 | ||
| EV/EBITDA | 8.79 |
4.3 Compensation for Growth
1MRKX's 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 12.94% in the coming years.
PEG (NY)0.62
PEG (5Y)1.33
EPS Next 2Y13.89%
EPS Next 3Y12.94%
5. Dividend
5.1 Amount
1MRKX has a Yearly Dividend Yield of 3.86%.
The stock price of 1MRKX dropped by -43.01% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
1MRKX's Dividend Yield is a higher than the industry average which is at 3.00.
1MRKX's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.86% |
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
45.54% of the earnings are spent on dividend by 1MRKX. 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 2Y13.89%
EPS Next 3Y12.94%
BIT:1MRKX (7/24/2025, 7:00:00 PM)
71.4
+1.6 (+2.29%)
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 Cap179.29B
Analysts76.25
Price Target92.02 (28.88%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.86% |
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)-0.22%
PT rev (3m)-14.96%
EPS NQ rev (1m)-0.61%
EPS NQ rev (3m)-5.36%
EPS NY rev (1m)-0.31%
EPS NY rev (3m)-1.2%
Revenue NQ rev (1m)0.34%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)-0.16%
Revenue NY rev (3m)-0.15%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.7 | ||
| Fwd PE | 8.42 | ||
| P/S | 3.28 | ||
| P/FCF | 12.29 | ||
| P/OCF | 10.03 | ||
| P/B | 4.33 | ||
| P/tB | 19.23 | ||
| EV/EBITDA | 8.79 |
EPS(TTM)6.67
EY9.34%
EPS(NY)8.48
Fwd EY11.88%
FCF(TTM)5.81
FCFY8.13%
OCF(TTM)7.12
OCFY9.97%
SpS21.79
BVpS16.48
TBVpS3.71
PEG (NY)0.62
PEG (5Y)1.33
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 | 3.93 |
F-Score8
WACC9.04%
ROIC/WACC1.41
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 Y17.37%
EPS Next 2Y13.89%
EPS Next 3Y12.94%
EPS Next 5Y5.96%
Revenue 1Y (TTM)4.1%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%-1.56%
Revenue Next Year1.51%
Revenue Next 2Y3.63%
Revenue Next 3Y4.2%
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%