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 53 industry peers in the Pharmaceuticals industry. 1MRKX has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. 1MRKX scores decently on growth, while it is valued quite cheap. This could make an interesting combination. These ratings could make 1MRKX a good candidate 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.
Each year in the past 5 years 1MRKX had a positive operating cash flow.
1.2 Ratios
1MRKX has a better Return On Assets (15.14%) than 92.31% of its industry peers.
1MRKX's Return On Equity of 36.07% is amongst the best of the industry. 1MRKX outperforms 88.46% of its industry peers.
With a decent Return On Invested Capital value of 12.73%, 1MRKX is doing good in the industry, outperforming 65.38% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for 1MRKX 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
With an excellent Profit Margin value of 27.27%, 1MRKX belongs to the best of the industry, outperforming 94.23% of the companies in the same industry.
1MRKX's Profit Margin has been stable in the last couple of years.
1MRKX has a better Operating Margin (33.84%) than 90.38% of its industry peers.
1MRKX's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 78.17%, 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 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.
Compared to 1 year ago, 1MRKX has about the same amount of shares outstanding.
1MRKX has less shares outstanding than it did 5 years ago.
1MRKX has a better debt/assets ratio than last year.
2.2 Solvency
1MRKX has an Altman-Z score of 3.93. This indicates that 1MRKX is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 3.93, 1MRKX is doing good in 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.
The Debt to FCF ratio of 1MRKX (2.04) is better than 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 has a Debt to Equity ratio (0.69) which is comparable to the rest of the 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 | 2.04 | ||
| Altman-Z | 3.93 |
ROIC/WACC1.41
WACC9.04%
2.3 Liquidity
A Current Ratio of 1.41 indicates that 1MRKX should not have too much problems paying its short term obligations.
With a Current ratio value of 1.41, 1MRKX perfoms like the industry average, outperforming 59.62% of the companies in the same industry.
A Quick Ratio of 1.16 indicates that 1MRKX should not have too much problems paying its short term obligations.
The Quick ratio of 1MRKX (1.16) is better than 73.08% 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.
1MRKX shows a small growth in Revenue. In the last year, the Revenue has grown by 4.10%.
Measured over the past years, 1MRKX shows a quite strong growth in Revenue. The Revenue has been growing by 10.40% on average per year.
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
1MRKX is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.96% yearly.
The Revenue is expected to grow by 2.20% on average over the next years.
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.
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 10.70, the valuation of 1MRKX can be described as very reasonable.
Compared to the rest of the industry, the Price/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/Earnings ratio of 1MRKX to the average of the S&P500 Index (28.04), we can say 1MRKX is valued rather cheaply.
A Price/Forward Earnings ratio of 8.42 indicates a reasonable valuation of 1MRKX.
Compared to the rest of the industry, the Price/Forward Earnings ratio of 1MRKX indicates a rather cheap valuation: 1MRKX is cheaper than 86.54% of the companies listed in the same industry.
1MRKX's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 37.64.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.7 | ||
| Fwd PE | 8.42 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 1MRKX is valued a bit cheaper than 75.00% of the companies in the same industry.
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.
1MRKX's earnings are expected to grow with 12.94% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.62
PEG (5Y)1.33
EPS Next 2Y13.89%
EPS Next 3Y12.94%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.86%, 1MRKX has a reasonable but not impressive dividend return.
In the last 3 months the price of 1MRKX has falen by -43.01%. 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 3.00, 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 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.86% |
5.2 History
The dividend of 1MRKX is nicely growing with an annual growth rate of 6.90%!
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 2Y13.89%
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%