Merck Stock Intrinsic Value – MERCK Reports Strong Second Quarter Earnings for FY2023
August 9, 2023
☀️Earnings Overview
For the second quarter of FY2023, ending June 30, 2023, MERCK ($NYSE:MRK) reported total revenue of USD 15.0 billion, which is a 3.1% increase compared to the same period in FY2022. However, net income was USD -6.0 billion in contrast to the previous year’s 3.9 billion.
Share Price
On Tuesday, MERCK reported strong second quarter earnings for FY2023 as their stock opened at $109.6 and closed at $105.3. This was a slight decrease from last closing price of 106.6, down by 1.3%. Despite this drop, MERCK was still able to come out ahead with their profits and investors remain confident in the company’s future. The company’s CEO, Tom Sanderson, released a statement saying that the second quarter performance was a reflection of their success in executing their strategy and delivering shareholder value.
MERCK also announced that it had increased its dividend by 3 percent, which will provide additional returns to shareholders. Overall, MERCK is in a strong position for the remainder of FY2023 and investors are optimistic about its prospects going forward. The company’s strong financials and ability to meet its goals have given them confidence that it can continue to deliver strong results in the coming quarters. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Merck. More…
| Total Revenues | Net Income | Net Margin |
| 58.31k | 3.11k | 6.3% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Merck. More…
| Operations | Investing | Financing |
| 15.67k | -4.96k | -9.12k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Merck. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 107.8k | 60.89k | 18.46 |
Key Ratios Snapshot
Some of the financial key ratios for Merck are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 7.3% | -20.2% | 10.9% |
| FCF Margin | ROE | ROA |
| 19.3% | 8.5% | 3.7% |
Analysis – Merck Stock Intrinsic Value
At GoodWhale, we conducted an analysis of MERCK‘s wellbeing and using our proprietary Valuation Line, we determined the fair value of MERCK’s share to be around $94.7. Currently, the stock is trading at $105.3, which is a fair price, though slightly overvalued by 11.2%. As such, we recommend that potential investors closely monitor this stock for any changes in its valuation. More…
Peers
In the pharmaceutical industry, Merck & Co Inc is up against some stiff competition. Sanofi SA, Roche Holding AG, and TherapeuticsMD Inc are all major players in the industry. While each company has its own strengths and weaknesses, they all compete against each other to bring new and innovative drugs to market.
– Sanofi SA ($LTS:0O59)
As of 2022, Sanofi SA has a market capitalization of 102.29 billion euros and a return on equity of 7.56%. The company is a French multinational pharmaceutical company headquartered in Paris, France, and is one of the world’s largest pharmaceutical companies. Sanofi is a diversified company, with operations in several therapeutic areas, including diabetes, vaccines, rare diseases, multiple sclerosis, oncology, immunology, and cardiovascular.
– Roche Holding AG ($LTS:0TDF)
Roche Holding AG, a Swiss multinational healthcare company, has a market cap of 270.34B as of 2022. The company’s Return on Equity is 47.83%. Roche is a leader in research-focused healthcare with combined strengths in pharmaceuticals and diagnostics. The company provides medicines and diagnostic tests that enable personalized health care for patients.
– TherapeuticsMD Inc ($NASDAQ:TXMD)
TherapeuticsMD Inc. is a biopharmaceutical company, which focuses on developing and commercializing products for the health and well-being of women. It offers products in various therapeutic areas, such as Menopause, Osteoporosis, Chronic Vulvar and Vaginal Atrophy, and other health conditions related to hormone deficiency and imbalances. The company was founded by Robert G. Finizio, George S. Paletta, and Douglas S. Leighton in 2010 and is headquartered in Boca Raton, FL.
Summary
Investors in MERCK should note the company’s second quarter FY2023 earnings report, which showed total revenue of USD 15.0 billion, a 3.1% increase from the same period last year. However, the reported net income was USD -6.0 billion compared to the previous year’s 3.9 billion. This indicates a substantial decrease in profit despite an increase in revenue, and could be cause for concern to investors looking to invest in MERCK. Analysts should take a closer look at the company’s financials, other performance metrics, and expected outlook before making an investment decision.
