MERCK & CO. INC. (6MK.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:6MK - US58933Y1055 - Common Stock
89.6 EUR
-0.4 (-0.44%)
Taking everything into account, 6MK scores 6 out of 10 in our fundamental rating. 6MK was compared to 55 industry peers in the Pharmaceuticals industry. 6MK has an excellent profitability rating, but there are some minor concerns on its financial health. 6MK has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- 6MK had positive earnings in the past year.
- In the past year 6MK had a positive cash flow from operations.
- 6MK had positive earnings in each of the past 5 years.
- 6MK had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- 6MK has a Return On Assets of 14.69%. This is amongst the best in the industry. 6MK outperforms 89.09% of its industry peers.
- With an excellent Return On Equity value of 36.71%, 6MK belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
- 6MK has a better Return On Invested Capital (12.83%) than 61.82% of its industry peers.
- 6MK had an Average Return On Invested Capital over the past 3 years of 13.67%. This is in line with the industry average of 14.00%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.69% | ||
| ROE | 36.71% | ||
| ROIC | 12.83% |
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
- 6MK's Profit Margin of 29.63% is amongst the best of the industry. 6MK outperforms 92.73% of its industry peers.
- In the last couple of years the Profit Margin of 6MK has remained more or less at the same level.
- 6MK has a Operating Margin of 38.08%. This is amongst the best in the industry. 6MK outperforms 90.91% of its industry peers.
- 6MK's Operating Margin has improved in the last couple of years.
- The Gross Margin of 6MK (78.72%) is better than 81.82% of its industry peers.
- 6MK's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 38.08% | ||
| PM (TTM) | 29.63% | ||
| GM | 78.72% |
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
- 6MK has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- Compared to 1 year ago, 6MK has about the same amount of shares outstanding.
- 6MK has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, 6MK has an improved debt to assets ratio.
2.2 Solvency
- 6MK has an Altman-Z score of 4.13. This indicates that 6MK is financially healthy and has little risk of bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 4.13, 6MK is in line with its industry, outperforming 54.55% of the companies in the same industry.
- The Debt to FCF ratio of 6MK is 3.17, which is a good value as it means it would take 6MK, 3.17 years of fcf income to pay off all of its debts.
- With a decent Debt to FCF ratio value of 3.17, 6MK is doing good in the industry, outperforming 69.09% of the companies in the same industry.
- 6MK has a Debt/Equity ratio of 0.77. This is a neutral value indicating 6MK is somewhat dependend on debt financing.
- 6MK has a Debt to Equity ratio (0.77) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 3.17 | ||
| Altman-Z | 4.13 |
ROIC/WACC1.47
WACC8.73%
2.3 Liquidity
- A Current Ratio of 1.66 indicates that 6MK should not have too much problems paying its short term obligations.
- 6MK's Current ratio of 1.66 is fine compared to the rest of the industry. 6MK outperforms 69.09% of its industry peers.
- 6MK has a Quick Ratio of 1.44. This is a normal value and indicates that 6MK is financially healthy and should not expect problems in meeting its short term obligations.
- With a decent Quick ratio value of 1.44, 6MK is doing good in the industry, outperforming 78.18% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.66 | ||
| Quick Ratio | 1.44 |
3. Growth
3.1 Past
- 6MK shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 48.07%, which is quite impressive.
- 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 1.68% 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)48.07%
EPS 3Y6.87%
EPS 5Y8.04%
EPS Q2Q%70.7%
Revenue 1Y (TTM)1.68%
Revenue growth 3Y9.63%
Revenue growth 5Y10.4%
Sales Q2Q%3.72%
3.2 Future
- 6MK is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.65% yearly.
- 6MK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.64% yearly.
EPS Next Y18.51%
EPS Next 2Y-13.49%
EPS Next 3Y10.11%
EPS Next 5Y6.65%
Revenue Next Year1.23%
Revenue Next 2Y2.83%
Revenue Next 3Y3.72%
Revenue Next 5Y2.64%
3.3 Evolution
- The EPS growth rate is stable: in the next years the growth will be about the same 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
- Based on the Price/Earnings ratio of 12.12, the valuation of 6MK can be described as correct.
- Based on the Price/Earnings ratio, 6MK is valued a bit cheaper than the industry average as 78.18% of the companies are valued more expensively.
- When comparing the Price/Earnings ratio of 6MK to the average of the S&P500 Index (28.87), we can say 6MK is valued rather cheaply.
- 6MK is valuated rather expensively with a Price/Forward Earnings ratio of 18.69.
- 6MK's Price/Forward Earnings ratio is in line with the industry average.
- 6MK's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 25.96.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.12 | ||
| Fwd PE | 18.69 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, 6MK is valued a bit cheaper than 76.36% 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 70.91% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.33 | ||
| EV/EBITDA | 9.98 |
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 an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)0.65
PEG (5Y)1.51
EPS Next 2Y-13.49%
EPS Next 3Y10.11%
5. Dividend
5.1 Amount
- 6MK has a Yearly Dividend Yield of 3.11%. Purely for dividend investing, there may be better candidates out there.
- 6MK's Dividend Yield is rather good when compared to the industry average which is at 1.62. 6MK pays more dividend than 83.64% of the companies in the same industry.
- 6MK's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.11% |
5.2 History
- The dividend of 6MK is nicely growing with an annual growth rate of 6.90%!
Dividend Growth(5Y)6.9%
Div Incr Years8
Div Non Decr Years8
5.3 Sustainability
- 6MK pays out 42.60% of its income as dividend. This is a bit on the high side, but may be sustainable.
- The dividend of 6MK is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP42.6%
EPS Next 2Y-13.49%
EPS Next 3Y10.11%
MERCK & CO. INC. / 6MK.DE FAQ
Can you provide the ChartMill fundamental rating for MERCK & CO. INC.?
ChartMill assigns a fundamental rating of 6 / 10 to 6MK.DE.
What is the valuation status for 6MK stock?
ChartMill assigns a valuation rating of 6 / 10 to MERCK & CO. INC. (6MK.DE). This can be considered as Fairly Valued.
What is the profitability of 6MK stock?
MERCK & CO. INC. (6MK.DE) has a profitability rating of 8 / 10.
What are the PE and PB ratios of MERCK & CO. INC. (6MK.DE) stock?
The Price/Earnings (PE) ratio for MERCK & CO. INC. (6MK.DE) is 12.12 and the Price/Book (PB) ratio is 5.12.
Is the dividend of MERCK & CO. INC. sustainable?
The dividend rating of MERCK & CO. INC. (6MK.DE) is 6 / 10 and the dividend payout ratio is 42.6%.