MRK Valuation

Merck & Co Inc

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80.400

-1.11(-1.362%)1D

Overview
Forecast
Valuation
Earnings

MRK Relative Valuation

MRK's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, MRK is overvalued; if below, it's undervalued.

Historical Valuation

Merck & Co Inc (MRK) is now in the Fair zone, suggesting that its current forward PE ratio of 8.90 is considered Fairly compared with the five-year average of 16.99. The fair price of Merck & Co Inc (MRK) is between 39.40 to 252.51 according to relative valuation methord.

Relative Value

Fair Zone

39.40-252.51

Current Price：80.40

Fair

8.78

Trailing

Forward

7.16

EV/EBITDA

Merck & Co Inc. (MRK) has a current EV/EBITDA of 7.16. The 5-year average EV/EBITDA is 11.68. The thresholds are as follows: Strongly Undervalued below 1.73, Undervalued between 1.73 and 6.71, Fairly Valued between 16.65 and 6.71, Overvalued between 16.65 and 21.63, and Strongly Overvalued above 21.63. The current Forward EV/EBITDA of 7.16 falls within the Historic Trend Line -Fairly Valued range.

8.24

EV/EBIT

Merck & Co Inc. (MRK) has a current EV/EBIT of 8.24. The 5-year average EV/EBIT is 14.17. The thresholds are as follows: Strongly Undervalued below -2.72, Undervalued between -2.72 and 5.72, Fairly Valued between 22.62 and 5.72, Overvalued between 22.62 and 31.07, and Strongly Overvalued above 31.07. The current Forward EV/EBIT of 8.24 falls within the Historic Trend Line -Fairly Valued range.

3.09

Merck & Co Inc. (MRK) has a current PS of 3.09. The 5-year average PS is 4.10. The thresholds are as follows: Strongly Undervalued below 2.96, Undervalued between 2.96 and 3.53, Fairly Valued between 4.66 and 3.53, Overvalued between 4.66 and 5.23, and Strongly Overvalued above 5.23. The current Forward PS of 3.09 falls within the Undervalued range.

8.41

P/OCF

Merck & Co Inc. (MRK) has a current P/OCF of 8.41. The 5-year average P/OCF is 12.56. The thresholds are as follows: Strongly Undervalued below 6.46, Undervalued between 6.46 and 9.51, Fairly Valued between 15.62 and 9.51, Overvalued between 15.62 and 18.67, and Strongly Overvalued above 18.67. The current Forward P/OCF of 8.41 falls within the Undervalued range.

10.76

P/FCF

Merck & Co Inc. (MRK) has a current P/FCF of 10.76. The 5-year average P/FCF is 15.22. The thresholds are as follows: Strongly Undervalued below 5.57, Undervalued between 5.57 and 10.40, Fairly Valued between 20.05 and 10.40, Overvalued between 20.05 and 24.88, and Strongly Overvalued above 24.88. The current Forward P/FCF of 10.76 falls within the Historic Trend Line -Fairly Valued range.

Merck & Co Inc (MRK) has a current Price-to-Book (P/B) ratio of 4.16. Compared to its 3-year average P/B ratio of 6.20 , the current P/B ratio is approximately -32.82% higher. Relative to its 5-year average P/B ratio of 6.19, the current P/B ratio is about -32.69% higher. Merck & Co Inc (MRK) has a Forward Free Cash Flow (FCF) yield of approximately 7.23%. Compared to its 3-year average FCF yield of 4.97%, the current FCF yield is approximately 45.42% lower. Relative to its 5-year average FCF yield of 4.70% , the current FCF yield is about 53.80% lower.

4.11

P/B

Median3y

6.20

Median5y

6.19

7.23

FCF Yield

Median3y

4.97

Median5y

4.70

Competitors Valuation Multiple

The average P/S ratio for MRK's competitors is 4.27, providing a benchmark for relative valuation. Merck & Co Inc Corp (MRK) exhibits a P/S ratio of , which is -100.00% above the industry average. Given its robust revenue growth of -1.90%, this premium appears unsustainable.

P/S

P/E

EV/EBITDA

EV/EBIT

P/S

Revenue Growth

Market Cap

Vertex Pharmaceuticals Inc

Loss

12.06%

98.23B

Performance Decomposition

Market capitalization of MRK decreased by 28.16% over the past 1 year. The primary factor behind the change was an decrease in Revenue Growth from 16.11B to 15.81B.

The secondary factor is the P/E Change, contributed -8.91%to the performance.

Overall, the performance of MRK in the past 1 year is driven by Revenue Growth. Which is more sustainable.

-1.90%

16.11B → 15.81B

Revenue Growth

-17.35%

33.89 → 28.01

Margin Expansion

-8.91%

13.61 → 12.40

P/E Change

-28.16%