Comparing Merck KGaA (MKKGY) & Its Competitors

Merck KGaA (OTCMKTS:MKKGY) is one of 897 public companies in the “Pharmaceuticals” industry, but how does it compare to its peers? We will compare Merck KGaA to related businesses based on the strength of its risk, valuation, dividends, analyst recommendations, institutional ownership, profitability and earnings.

Institutional & Insider Ownership

0.1% of Merck KGaA shares are held by institutional investors. Comparatively, 32.5% of shares of all “Pharmaceuticals” companies are held by institutional investors. 14.1% of shares of all “Pharmaceuticals” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent recommendations for Merck KGaA and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Merck KGaA	1	5	0	0	1.83
Merck KGaA Competitors	7765	13847	25696	1031	2.41

As a group, “Pharmaceuticals” companies have a potential upside of 24.37%. Given Merck KGaA’s peers stronger consensus rating and higher probable upside, analysts plainly believe Merck KGaA has less favorable growth aspects than its peers.

Dividends

Merck KGaA pays an annual dividend of $0.34 per share and has a dividend yield of 1.0%. Merck KGaA pays out 17.5% of its earnings in the form of a dividend. As a group, “Pharmaceuticals” companies pay a dividend yield of 3.3% and pay out 48.2% of their earnings in the form of a dividend.

Earnings & Valuation

This table compares Merck KGaA and its peers top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Merck KGaA	$23.87 billion	$2.95 billion	17.36
Merck KGaA Competitors	$3.55 billion	$3.19 billion	547.83

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.

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	-2,380.90%	-221.90%	-15.99%

Risk & Volatility

Merck KGaA has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500. Comparatively, Merck KGaA’s peers have a beta of -3.75, suggesting that their average share price is 475% less volatile than the S&P 500.

Summary

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

Merck KGaA Company Profile

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.