MERCK KGAA (MRK.DE) Stock Fundamental Analysis
FRA:MRK - DE0006599905 - Common Stock
112.15 EUR
+1.65 (+1.49%)
Overall MRK gets a fundamental rating of 4 out of 10. We evaluated MRK against 52 industry peers in the Pharmaceuticals industry. Both the profitability and the financial health of MRK get a neutral evaluation. Nothing too spectacular is happening here. MRK has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
MRK had positive earnings in the past year.
MRK had a positive operating cash flow in the past year.
In the past 5 years MRK has always been profitable.
Each year in the past 5 years MRK had a positive operating cash flow.
1.2 Ratios
MRK has a Return On Assets (6.04%) which is in line with its industry peers.
MRK has a Return On Equity (10.13%) which is in line with its industry peers.
MRK has a Return On Invested Capital of 8.18%. This is comparable to the rest of the industry: MRK outperforms 50.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MRK is significantly below the industry average of 15.11%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.04% | ||
| ROE | 10.13% | ||
| ROIC | 8.18% |
ROA(3y)6.02%
ROA(5y)5.91%
ROE(3y)10.9%
ROE(5y)11.75%
ROIC(3y)9.28%
ROIC(5y)9.07%
1.3 Margins
MRK has a Profit Margin (13.49%) which is in line with its industry peers.
MRK's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 18.05%, MRK is in line with its industry, outperforming 50.00% of the companies in the same industry.
In the last couple of years the Operating Margin of MRK has grown nicely.
The Gross Margin of MRK (58.51%) is worse than 65.38% of its industry peers.
In the last couple of years the Gross Margin of MRK has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.05% | ||
| PM (TTM) | 13.49% | ||
| GM | 58.51% |
OM growth 3Y-2.38%
OM growth 5Y5.83%
PM growth 3Y-5.43%
PM growth 5Y9.94%
GM growth 3Y-1.81%
GM growth 5Y-1.2%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so MRK is still creating some value.
MRK has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, MRK has about the same amount of shares outstanding.
MRK has a better debt/assets ratio than last year.
2.2 Solvency
MRK has an Altman-Z score of 2.99. This is not the best score and indicates that MRK is in the grey zone with still only limited risk for bankruptcy at the moment.
MRK has a Altman-Z score (2.99) which is comparable to the rest of the industry.
The Debt to FCF ratio of MRK is 5.26, which is a neutral value as it means it would take MRK, 5.26 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 5.26, MRK perfoms like the industry average, outperforming 48.08% of the companies in the same industry.
A Debt/Equity ratio of 0.22 indicates that MRK is not too dependend on debt financing.
MRK has a better Debt to Equity ratio (0.22) than 69.23% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 5.26 | ||
| Altman-Z | 2.99 |
ROIC/WACC1.22
WACC6.71%
2.3 Liquidity
MRK has a Current Ratio of 1.24. This is a normal value and indicates that MRK is financially healthy and should not expect problems in meeting its short term obligations.
MRK's Current ratio of 1.24 is in line compared to the rest of the industry. MRK outperforms 40.38% of its industry peers.
A Quick Ratio of 0.78 indicates that MRK may have some problems paying its short term obligations.
With a Quick ratio value of 0.78, MRK is not doing good in the industry: 67.31% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.78 |
3. Growth
3.1 Past
MRK shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.03%.
The Earnings Per Share has been growing by 9.19% on average over the past years. This is quite good.
MRK shows a small growth in Revenue. In the last year, the Revenue has grown by 1.67%.
Measured over the past years, MRK shows a small growth in Revenue. The Revenue has been growing by 5.55% on average per year.
EPS 1Y (TTM)4.03%
EPS 3Y-0.35%
EPS 5Y9.19%
EPS Q2Q%-8.18%
Revenue 1Y (TTM)1.67%
Revenue growth 3Y2.43%
Revenue growth 5Y5.55%
Sales Q2Q%-1.81%
3.2 Future
MRK is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.59% yearly.
The Revenue is expected to grow by 3.40% on average over the next years.
EPS Next Y8.35%
EPS Next 2Y8.91%
EPS Next 3Y7.86%
EPS Next 5Y5.59%
Revenue Next Year1.84%
Revenue Next 2Y2.88%
Revenue Next 3Y3.05%
Revenue Next 5Y3.4%
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
With a Price/Earnings ratio of 13.18, MRK is valued correctly.
69.23% of the companies in the same industry are more expensive than MRK, based on the Price/Earnings ratio.
MRK's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.24.
Based on the Price/Forward Earnings ratio of 10.96, the valuation of MRK can be described as reasonable.
67.31% of the companies in the same industry are more expensive than MRK, based on the Price/Forward Earnings ratio.
MRK's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 35.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.18 | ||
| Fwd PE | 10.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MRK is valued a bit cheaper than 63.46% of the companies in the same industry.
MRK's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.36 | ||
| EV/EBITDA | 9.63 |
4.3 Compensation for Growth
MRK's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PEG (NY)1.58
PEG (5Y)1.43
EPS Next 2Y8.91%
EPS Next 3Y7.86%
5. Dividend
5.1 Amount
MRK has a Yearly Dividend Yield of 1.98%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.18, MRK has a dividend in line with its industry peers.
MRK's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.98% |
5.2 History
The dividend of MRK is nicely growing with an annual growth rate of 11.88%!
Dividend Growth(5Y)11.88%
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
9.92% of the earnings are spent on dividend by MRK. This is a low number and sustainable payout ratio.
MRK's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP9.92%
EPS Next 2Y8.91%
EPS Next 3Y7.86%
FRA:MRK (8/22/2025, 5:35:30 PM)
112.15
+1.65 (+1.49%)
Chartmill FA Rating
GICS SectorHealth Care
GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences
GICS IndustryPharmaceuticals
Earnings (Last)
Earnings (Next)
Inst Owners48.59%
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap48.76B
Analysts78.33
Price Target157.14 (40.12%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.98% |
Yearly Dividend0.65
Dividend Growth(5Y)11.88%
DP9.92%
Div Incr Years0
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-4.13%
Min EPS beat(2)-4.83%
Max EPS beat(2)-3.43%
EPS beat(4)0
Avg EPS beat(4)-2.8%
Min EPS beat(4)-4.83%
Max EPS beat(4)-0.39%
EPS beat(8)3
Avg EPS beat(8)0.89%
EPS beat(12)4
Avg EPS beat(12)-0.1%
EPS beat(16)6
Avg EPS beat(16)-0.14%
Revenue beat(2)0
Avg Revenue beat(2)-1.65%
Min Revenue beat(2)-1.98%
Max Revenue beat(2)-1.33%
Revenue beat(4)0
Avg Revenue beat(4)-1.52%
Min Revenue beat(4)-2.1%
Max Revenue beat(4)-0.68%
Revenue beat(8)1
Avg Revenue beat(8)-1.41%
Revenue beat(12)2
Avg Revenue beat(12)-1.23%
Revenue beat(16)3
Avg Revenue beat(16)-1%
PT rev (1m)-4.18%
PT rev (3m)-8.65%
EPS NQ rev (1m)-4.37%
EPS NQ rev (3m)-8.9%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)-3.48%
Revenue NQ rev (3m)-3.87%
Revenue NY rev (1m)-0.98%
Revenue NY rev (3m)-0.98%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.18 | ||
| Fwd PE | 10.96 | ||
| P/S | 2.3 | ||
| P/FCF | 27.36 | ||
| P/OCF | 12.79 | ||
| P/B | 1.73 | ||
| P/tB | 9.14 | ||
| EV/EBITDA | 9.63 |
EPS(TTM)8.51
EY7.59%
EPS(NY)10.24
Fwd EY9.13%
FCF(TTM)4.1
FCFY3.65%
OCF(TTM)8.77
OCFY7.82%
SpS48.8
BVpS65
TBVpS12.27
PEG (NY)1.58
PEG (5Y)1.43
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.04% | ||
| ROE | 10.13% | ||
| ROCE | 10.21% | ||
| ROIC | 8.18% | ||
| ROICexc | 8.53% | ||
| ROICexgc | 23.59% | ||
| OM | 18.05% | ||
| PM (TTM) | 13.49% | ||
| GM | 58.51% | ||
| FCFM | 8.4% |
ROA(3y)6.02%
ROA(5y)5.91%
ROE(3y)10.9%
ROE(5y)11.75%
ROIC(3y)9.28%
ROIC(5y)9.07%
ROICexc(3y)9.79%
ROICexc(5y)9.49%
ROICexgc(3y)29.91%
ROICexgc(5y)31.66%
ROCE(3y)11.59%
ROCE(5y)11.34%
ROICexcg growth 3Y-8.23%
ROICexcg growth 5Y-5.36%
ROICexc growth 3Y-3.27%
ROICexc growth 5Y7.94%
OM growth 3Y-2.38%
OM growth 5Y5.83%
PM growth 3Y-5.43%
PM growth 5Y9.94%
GM growth 3Y-1.81%
GM growth 5Y-1.2%
F-Score7
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 5.26 | ||
| Debt/EBITDA | 1.09 | ||
| Cap/Depr | 105.23% | ||
| Cap/Sales | 9.57% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.21% | ||
| Profit Quality | 62.26% | ||
| Current Ratio | 1.24 | ||
| Quick Ratio | 0.78 | ||
| Altman-Z | 2.99 |
F-Score7
WACC6.71%
ROIC/WACC1.22
Cap/Depr(3y)99.64%
Cap/Depr(5y)92.04%
Cap/Sales(3y)9.36%
Cap/Sales(5y)8.84%
Profit Quality(3y)74.2%
Profit Quality(5y)84.7%
High Growth Momentum
Growth
EPS 1Y (TTM)4.03%
EPS 3Y-0.35%
EPS 5Y9.19%
EPS Q2Q%-8.18%
EPS Next Y8.35%
EPS Next 2Y8.91%
EPS Next 3Y7.86%
EPS Next 5Y5.59%
Revenue 1Y (TTM)1.67%
Revenue growth 3Y2.43%
Revenue growth 5Y5.55%
Sales Q2Q%-1.81%
Revenue Next Year1.84%
Revenue Next 2Y2.88%
Revenue Next 3Y3.05%
Revenue Next 5Y3.4%
EBIT growth 1Y13.79%
EBIT growth 3Y-0.01%
EBIT growth 5Y11.7%
EBIT Next Year40.77%
EBIT Next 3Y16.3%
EBIT Next 5Y11.43%
FCF growth 1Y-13.28%
FCF growth 3Y-9.07%
FCF growth 5Y5.53%
OCF growth 1Y-5.67%
OCF growth 3Y-0.22%
OCF growth 5Y9.93%