Merck & (NYSE: MRK) is one of 113 public companies in the “Pharmaceuticals” industry, but how does it compare to its competitors? We will compare Merck & to related companies based on the strength of its analyst recommendations, institutional ownership, earnings, profitability, dividends, valuation and risk.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Merck & and its competitors, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Merck & 1 7 10 0 2.50
Merck & Competitors 952 3818 6060 164 2.49

Merck & currently has a consensus price target of $69.64, indicating a potential upside of 8.19%. As a group, “Pharmaceuticals” companies have a potential upside of 22.85%. Given Merck &’s competitors higher possible upside, analysts plainly believe Merck & has less favorable growth aspects than its competitors.

Volatility & Risk

Merck & has a beta of 0.8, indicating that its stock price is 20% less volatile than the S&P 500. Comparatively, Merck &’s competitors have a beta of 0.87, indicating that their average stock price is 13% less volatile than the S&P 500.

Earnings & Valuation

This table compares Merck & and its competitors revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Merck & $40.02 billion $15.45 billion 26.06
Merck & Competitors $7.79 billion $2.46 billion 0.01

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

Profitability

This table compares Merck & and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Merck & 17.14% 26.02% 11.15%
Merck & Competitors -3,194.30% -54.64% -8.66%

Insider & Institutional Ownership

72.9% of Merck & shares are owned by institutional investors. Comparatively, 44.0% of shares of all “Pharmaceuticals” companies are owned by institutional investors. 0.1% of Merck & shares are owned by company insiders. Comparatively, 12.1% of shares of all “Pharmaceuticals” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

Merck & pays an annual dividend of $1.88 per share and has a dividend yield of 2.9%. Merck & pays out 76.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Pharmaceuticals” companies pay a dividend yield of 2.3% and pay out 82.4% of their earnings in the form of a dividend. Merck & has raised its dividend for 5 consecutive years. Merck & is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Summary

Merck & beats its competitors on 11 of the 15 factors compared.

About Merck &

Merck & Co., Inc. is a global healthcare company. The Company offers health solutions through its prescription medicines, vaccines, biologic therapies and animal health products. It operates through four segments: Pharmaceutical, Animal Health, Healthcare Services and Alliances. The Company’s Pharmaceutical segment includes human health pharmaceutical and vaccine products marketed either directly by the Company or through joint ventures. Human health pharmaceutical products consist of therapeutic and preventive agents, generally sold by prescription, for the treatment of human disorders. The Company sells its human health pharmaceutical products primarily to drug wholesalers and retailers, hospitals, government agencies and managed healthcare providers, such as health maintenance organizations, pharmacy benefit managers and other institutions. Vaccine products consist of preventive pediatric, adolescent and adult vaccines, primarily administered at physician offices.

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