Analyzing Merck KGaA (MKKGY) & Its Peers

Merck KGaA (OTCMKTS:MKKGY) is one of 1,049 public companies in the “Pharmaceutical preparations” industry, but how does it compare to its rivals? We will compare Merck KGaA to similar businesses based on the strength of its valuation, profitability, institutional ownership, dividends, earnings, analyst recommendations and risk.

Volatility and Risk

Merck KGaA has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500. Comparatively, Merck KGaA’s rivals have a beta of 1.00, meaning that their average share price is 0% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Merck KGaA	12.89%	10.51%	5.93%
Merck KGaA Competitors	-3,610.16%	-274.38%	-39.07%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Merck KGaA and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Merck KGaA	0	1	1	0	2.50
Merck KGaA Competitors	7610	20893	48546	1193	2.55

As a group, “Pharmaceutical preparations” companies have a potential upside of 71.73%. Given Merck KGaA’s rivals stronger consensus rating and higher possible upside, analysts plainly believe Merck KGaA has less favorable growth aspects than its rivals.

Earnings & Valuation

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

	Gross Revenue	Net Income	Price/Earnings Ratio
Merck KGaA	$22.72 billion	$3.06 billion	18.48
Merck KGaA Competitors	$1.72 billion	$154.84 million	-5.58

Merck KGaA has higher revenue and earnings than its rivals. Merck KGaA is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Institutional and Insider Ownership

0.1% of Merck KGaA shares are held by institutional investors. Comparatively, 44.3% of shares of all “Pharmaceutical preparations” companies are held by institutional investors. 13.8% of shares of all “Pharmaceutical preparations” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Merck KGaA rivals beat Merck KGaA on 7 of the 13 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.