Merck KGaA (MKKGY) vs. Its Peers Financial Comparison

Merck KGaA (OTCMKTS:MKKGY) is one of 896 publicly-traded companies in the “Pharmaceuticals” industry, but how does it contrast to its peers? We will compare Merck KGaA to related businesses based on the strength of its institutional ownership, analyst recommendations, risk, profitability, dividends, valuation and earnings.

Valuation and Earnings

This table compares Merck KGaA and its peers gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Merck KGaA	$23.87 billion	$2.95 billion	17.12
Merck KGaA Competitors	$3.55 billion	$3.17 billion	547.98

Merck KGaA has higher revenue, but lower earnings than its peers. Merck KGaA is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Dividends

Merck KGaA pays an annual dividend of $0.35 per share and has a dividend yield of 1.1%. Merck KGaA pays out 18.0% of its earnings in the form of a dividend. As a group, “Pharmaceuticals” companies pay a dividend yield of 3.2% and pay out 48.2% of their earnings in the form of a dividend.

Profitability

This table compares Merck KGaA and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Merck KGaA	11.20%	8.10%	4.58%
Merck KGaA Competitors	-2,372.59%	-220.83%	-15.99%

Volatility & Risk

Merck KGaA has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500. Comparatively, Merck KGaA’s peers have a beta of -3.79, suggesting that their average stock price is 479% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Merck KGaA and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Merck KGaA	1	5	0	0	1.83
Merck KGaA Competitors	7769	13856	25728	1032	2.41

As a group, “Pharmaceuticals” companies have a potential upside of 23.96%. Given Merck KGaA’s peers stronger consensus rating and higher possible upside, analysts clearly believe Merck KGaA has less favorable growth aspects than its peers.

Insider and Institutional Ownership

0.1% of Merck KGaA shares are owned by institutional investors. Comparatively, 32.6% of shares of all “Pharmaceuticals” companies are owned by institutional investors. 14.1% of shares of all “Pharmaceuticals” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Merck KGaA peers beat Merck KGaA on 9 of the 15 factors compared.

About Merck KGaA

Merck KGaA operates as a science and technology company in Germany. It operates through Life Science, Healthcare, and Electronics segments. The company’s Life Science segment offers tools, chemicals, and equipment for academic labs, biotech, and pharmaceutical manufacturers, as well as industrial sector. This segment provides drug manufacturers with process development expertise and technologies, such as continuous bioprocessing; testing kits and services; reagents and services; testing solutions that analyze air, water, and soil; and testing and tools, as well as products that help test nutritional value and identify quality inconsistencies. Its Healthcare segment discovers, develops, manufacturers, and markets prescription drugs and biopharmaceuticals for the treatment of oncology, neurology and immunology, fertility, endocrinology, as well as cardiovascular, diabetes, thyroid disorders, and multiple sclerosis; general medicines; and injection device and disease monitoring software. The Electronics segment supplies materials for the semiconductor and display industries and surface design, such as delivery systems and services, as well as surface solutions, including cosmetics, effect pigments, and functional solutions. In addition, it has in-licensing agreement with Debiopharm International SA for developing and commercializing drug candidates for the treatment of head and neck cancer; Jiangsu Hengrui Pharmaceuticals Co. Ltd. for developing, manufacturing, and commercializing drug candidates for the treatment of metastatic colorectal cancer; and Abbisko Therapeutics Co. Ltd. for developing and commercializing of drug candidates for the treatment of tenosynovial giant cell tumor, as well as license and collaboration agreement with Merck KGaA to discover two targeted protein degraders against critical oncogenic proteins. The company was founded in 1668 and is headquartered in Darmstadt, Germany. Merck KGaA operates as a subsidiary of E. Merck KGaA.