MERCK & CO. INC. (1MRKX.MI) Stock Fundamental Analysis
BIT:1MRKX - Euronext Milan - US58933Y1055 - Common Stock - Currency: EUR
1MRKX gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 52 industry peers in the Pharmaceuticals industry. While 1MRKX has a great profitability rating, there are some minor concerns on its financial health. 1MRKX is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings would make 1MRKX suitable for value 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 13.96% is amongst the best of the industry. 1MRKX outperforms 92.31% of its industry peers.
Looking at the Return On Equity, with a value of 33.49%, 1MRKX belongs to the top of the industry, outperforming 88.46% of the companies in the same industry.
The Return On Invested Capital of 1MRKX (13.81%) is better than 67.31% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1MRKX is in line with the industry average of 15.11%.
The last Return On Invested Capital (13.81%) for 1MRKX is above the 3 year average (13.67%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.96% | ||
| ROE | 33.49% | ||
| ROIC | 13.81% |
ROA(3y)9.42%
ROA(5y)9.66%
ROE(3y)23.17%
ROE(5y)26.32%
ROIC(3y)13.67%
ROIC(5y)12.02%
1.3 Margins
The Profit Margin of 1MRKX (25.79%) is better than 88.46% 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 has a better Operating Margin (37.52%) than 90.38% 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 78.32%, 1MRKX is doing good in the industry, outperforming 78.85% of the companies in the same industry.
In the last couple of years the Gross Margin of 1MRKX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 37.52% | ||
| PM (TTM) | 25.79% | ||
| GM | 78.32% |
OM growth 3Y5.75%
OM growth 5Y7.99%
PM growth 3Y-0.15%
PM growth 5Y1.18%
GM growth 3Y1.92%
GM growth 5Y1.45%
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.
Compared to 1 year ago, 1MRKX has about the same amount of shares outstanding.
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 3.94 indicates that 1MRKX is not in any danger for bankruptcy at the moment.
1MRKX's Altman-Z score of 3.94 is in line compared to the rest of the industry. 1MRKX outperforms 59.62% of its industry peers.
The Debt to FCF ratio of 1MRKX is 2.40, which is a good value as it means it would take 1MRKX, 2.40 years of fcf income to pay off all of its debts.
1MRKX has a Debt to FCF ratio of 2.40. This is in the better half of the industry: 1MRKX outperforms 76.92% of its industry peers.
A Debt/Equity ratio of 0.69 indicates that 1MRKX is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.69, 1MRKX is in line with its industry, outperforming 46.15% of the companies in the same industry.
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 | 2.4 | ||
| Altman-Z | 3.94 |
ROIC/WACC1.5
WACC9.21%
2.3 Liquidity
A Current Ratio of 1.42 indicates that 1MRKX should not have too much problems paying its short term obligations.
1MRKX has a Current ratio (1.42) which is in line with its industry peers.
A Quick Ratio of 1.17 indicates that 1MRKX should not have too much problems paying its short term obligations.
The Quick ratio of 1MRKX (1.17) is better than 71.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.42 | ||
| Quick Ratio | 1.17 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 18.28% 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 1.82% 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)18.28%
EPS 3Y6.87%
EPS 5Y8.04%
EPS Q2Q%-3.95%
Revenue 1Y (TTM)1.82%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%-1.9%
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 5.37% on average per year.
1MRKX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.86% yearly.
EPS Next Y17.37%
EPS Next 2Y13.89%
EPS Next 3Y12.94%
EPS Next 5Y5.37%
Revenue Next Year1.52%
Revenue Next 2Y3.58%
Revenue Next 3Y4.21%
Revenue Next 5Y1.86%
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 10.65, the valuation of 1MRKX can be described as very reasonable.
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.
The average S&P500 Price/Earnings ratio is at 26.84. 1MRKX is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 8.28, which indicates a very decent valuation of 1MRKX.
Based on the Price/Forward Earnings ratio, 1MRKX is valued cheaper than 84.62% of the companies in the same industry.
1MRKX is valuated cheaply when we compare the Price/Forward Earnings ratio to 35.29, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.65 | ||
| Fwd PE | 8.28 |
4.2 Price Multiples
1MRKX's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. 1MRKX is cheaper than 76.92% of the companies in the same industry.
76.92% 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 | 13.99 | ||
| EV/EBITDA | 8.16 |
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.
1MRKX has an outstanding profitability rating, which may justify a higher PE ratio.
1MRKX's earnings are expected to grow with 12.94% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.61
PEG (5Y)1.32
EPS Next 2Y13.89%
EPS Next 3Y12.94%
5. Dividend
5.1 Amount
1MRKX has a Yearly Dividend Yield of 3.91%.
In the last 3 months the price of 1MRKX has falen by -27.85%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 3.18, 1MRKX pays a bit more dividend than its industry peers.
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 | 3.91% |
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
48.95% 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.
DP48.95%
EPS Next 2Y13.89%
EPS Next 3Y12.94%
BIT:1MRKX (8/13/2025, 7:00:00 PM)
70.2
+1.6 (+2.33%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners80.5%
Inst Owner ChangeN/A
Ins Owners0.05%
Ins Owner ChangeN/A
Market Cap176.27B
Analysts76.25
Price Target87.14 (24.13%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.91% |
Yearly Dividend2.65
Dividend Growth(5Y)6.9%
DP48.95%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.31%
Min EPS beat(2)2.93%
Max EPS beat(2)7.69%
EPS beat(4)4
Avg EPS beat(4)4.85%
Min EPS beat(4)2.93%
Max EPS beat(4)7.69%
EPS beat(8)8
Avg EPS beat(8)21.1%
EPS beat(12)12
Avg EPS beat(12)15.97%
EPS beat(16)16
Avg EPS beat(16)15.3%
Revenue beat(2)1
Avg Revenue beat(2)-0.54%
Min Revenue beat(2)-1.54%
Max Revenue beat(2)0.45%
Revenue beat(4)2
Avg Revenue beat(4)-0.25%
Min Revenue beat(4)-1.54%
Max Revenue beat(4)0.45%
Revenue beat(8)5
Avg Revenue beat(8)0.7%
Revenue beat(12)9
Avg Revenue beat(12)1.51%
Revenue beat(16)13
Avg Revenue beat(16)2.28%
PT rev (1m)-5.31%
PT rev (3m)-8.19%
EPS NQ rev (1m)-3.62%
EPS NQ rev (3m)-4.19%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.03%
Revenue NQ rev (1m)-0.14%
Revenue NQ rev (3m)-0.68%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)-0.23%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.65 | ||
| Fwd PE | 8.28 | ||
| P/S | 3.24 | ||
| P/FCF | 13.99 | ||
| P/OCF | 11.12 | ||
| P/B | 4.21 | ||
| P/tB | 16.88 | ||
| EV/EBITDA | 8.16 |
EPS(TTM)6.59
EY9.39%
EPS(NY)8.48
Fwd EY12.08%
FCF(TTM)5.02
FCFY7.15%
OCF(TTM)6.32
OCFY9%
SpS21.68
BVpS16.69
TBVpS4.16
PEG (NY)0.61
PEG (5Y)1.32
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.96% | ||
| ROE | 33.49% | ||
| ROCE | 26.09% | ||
| ROIC | 13.81% | ||
| ROICexc | 15.25% | ||
| ROICexgc | 27.43% | ||
| OM | 37.52% | ||
| PM (TTM) | 25.79% | ||
| GM | 78.32% | ||
| FCFM | 23.14% |
ROA(3y)9.42%
ROA(5y)9.66%
ROE(3y)23.17%
ROE(5y)26.32%
ROIC(3y)13.67%
ROIC(5y)12.02%
ROICexc(3y)15.77%
ROICexc(5y)13.76%
ROICexgc(3y)34.22%
ROICexgc(5y)31.54%
ROCE(3y)25.81%
ROCE(5y)22.7%
ROICexcg growth 3Y7.57%
ROICexcg growth 5Y3.37%
ROICexc growth 3Y15.27%
ROICexc growth 5Y10.69%
OM growth 3Y5.75%
OM growth 5Y7.99%
PM growth 3Y-0.15%
PM growth 5Y1.18%
GM growth 3Y1.92%
GM growth 5Y1.45%
F-Score7
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.69 | ||
| Debt/FCF | 2.4 | ||
| Debt/EBITDA | 1.19 | ||
| Cap/Depr | 82.85% | ||
| Cap/Sales | 5.99% | ||
| Interest Coverage | 17.88 | ||
| Cash Conversion | 65.1% | ||
| Profit Quality | 89.74% | ||
| Current Ratio | 1.42 | ||
| Quick Ratio | 1.17 | ||
| Altman-Z | 3.94 |
F-Score7
WACC9.21%
ROIC/WACC1.5
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)18.28%
EPS 3Y6.87%
EPS 5Y8.04%
EPS Q2Q%-3.95%
EPS Next Y17.37%
EPS Next 2Y13.89%
EPS Next 3Y12.94%
EPS Next 5Y5.37%
Revenue 1Y (TTM)1.82%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%-1.9%
Revenue Next Year1.52%
Revenue Next 2Y3.58%
Revenue Next 3Y4.21%
Revenue Next 5Y1.86%
EBIT growth 1Y1.85%
EBIT growth 3Y15.93%
EBIT growth 5Y19.23%
EBIT Next Year29.85%
EBIT Next 3Y14.96%
EBIT Next 5Y9.07%
FCF growth 1Y35.96%
FCF growth 3Y23.27%
FCF growth 5Y12.67%
OCF growth 1Y22.95%
OCF growth 3Y15.02%
OCF growth 5Y9.82%