Merck & Company Inc
Buy, Hold or Sell?

Let's analyse Merck together

Penke I guess you are interested in Merck & Company Inc. Buy, hold or sell? I don't know! However, I do recommend doing research before doing anything. I will help you with that.

I'm going to help you getting a better view of Merck & Company Inc. At the end you don't have to ask anyone for trading advice. You can make your own decision, with more confidence, the odds in your favor, backed by data.

You can find me behind Let's Analyse Together in the top-right of each section.

Get notifications about Merck & Company Inc

I send you an email if I find something interesting about Merck & Company Inc.

Quick analysis of Merck (30 sec.)

1. Valuation of Merck (5 min.)

Live pricePrice per share (EOD)

$109.80

Book Value per Share

$18.15

2. Growth of Merck (5 min.)

Is Merck growing?

	Current year	Previous year	Grow	Grow %
How rich?	$46b	$33.6b	$10b	23.1%

How much money is Merck making?

	Current year	Previous year	Grow	Grow %
Making money	$3.6b	$3.2b	$367.5m	10.1%
Net Profit Margin	24.4%	25.6%	-	-

How much money comes from the company's main activities?

Quarterly Yearly

3. Financial Health of Merck (5 min.)

4. Comparing to competitors in the Drug Manufacturers-General industry (5 min.)

Industry Rankings (Drug Manufacturers-General)

Richest
#9 / 79

Most Revenue
#10 / 79

Most Profit
#10 / 79

Most Efficient
#16 / 79

Fundamentals of Merck

Financial Health

Profitability Details

	Compared to previous year	Compared to industry
The company is making a huge profit.
Using its assets, the company is less efficient in making profit.
Using its investors money, the company is less efficient in making profit.

Operating Efficiency Details

	Compared to previous year	Compared to industry
The company is operating very efficient.
The company is less efficient in keeping operating costs low.

Liquidity Details

	Compared to previous year	Compared to industry
The company is just able to pay all its short-term debts.
The company is just not able to pay all its short-term debts with the most liquid assets.

Solvency Details

	Compared to previous year	Compared to industry
The company is able to pay all its debts by selling its assets.
The company is able to pay all its debts with equity.

1.1. Profitability of Merck & Company Inc.

1.1. Profitability

1.1.1. Net Profit Margin

Measures how much net profit Merck earns for each $1 of revenue.

Above 10% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
A Net Profit Margin of 21.8% means that $0.22 for each $1 in revenue is generated as profit.

Let's take a look of the Net Profit Margin trends of Merck & Company Inc:

The MRQ is 21.8%. The company is making a huge profit. +2
The TTM is 24.4%. The company is making a huge profit. +2

Trends

Current period		Compared to		+/-
MRQ	21.8%	TTM	24.4%	-2.6%
TTM	24.4%	YOY	25.6%	-1.2%
TTM	24.4%	5Y	20.7%	+3.7%
5Y	20.7%	10Y	20.7%	0.0%

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	21.8%	15.7%	+6.1%
TTM	24.4%	14.8%	+9.6%
YOY	25.6%	16.6%	+9.0%
5Y	20.7%	16.4%	+4.3%
10Y	20.7%	16.6%	+4.1%

Measures how much net profit Merck earns for each $1 of revenue.

Revenue is the amount of profit Merck generates before taxes and all other costs. For example, when you buy a cup of coffee it will cost you $3. The company does not earn $3 in profit but also has to pay various costs and taxes to create that cup of coffee. Let's assume the cost of creating a cup of coffee is $1.5.

The $3 you pay for a cup of coffee is called revenue.
The $1.5 that’s left over when all costs to create that cup of coffee (including taxes) are deduced from the revenue is called net profit.

The net profit margin looks at how much net profit Merck earns for each $1 in revenue.

How to use net profit margin

Higher profit margin is better (more profit).
Above 10% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
Can be used to compare companies within the Drug Manufacturers-General industry.

You typically want a high profit margin. This means that for each $1 in sales, Merck makes more profit. This shows the investor how efficiently Merck is operating in general and compared to other companies in the same industry. Merck operates in the Drug Manufacturers-General industry.

Why do investors use net profit margin in their analysis

It helps investors to determine the efficiency of Merck. If profit margins remain low (compared to the Drug Manufacturers-General industry mean) and there are no improvements to make in production costs or other areas that might be a warning sign. If profit margins are high that means the company has low overhead costs and is efficiently using its resources to generate profit.

The three steps every investor should look at:

What is the current net profit margin?
The current most recent quarter (MRQ) Net Profit Margin of Merck is 0.22. This means that Merck earned $0.22 for each $1 in revenue in the most recent quarter.
How does it compare to the industry?
The mean MRQ Net Profit Margin of the Drug Manufacturers-General industry is 15.7%.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare Merck with other companies in the same industry (Drug Manufacturers-General).
Net profit margin should rise over the years.
Can be influenced when Merck sells assets (profit will increase while costs remain the same).
It won’t show what part of Merck is doing great or needs improvement (it only looks at total revenue and total net income).

How to calculate net profit margin

Net profit margin = net income / total revenue * 100%

Real example of Merck

You need the following data to determine net profit margin:

Income statement from the period you want to calculate (for example, MRQ or TTM).

Net income MRQ Merck = 3,017,000
Total revenue MRQ Merck = 13,830,000
$3,017,000 / $13,830,000 = 0.22 or 21.8%

Higher is better

The higher the net profit margin, the more efficient the company is generating income. This helps investors to determine how the company is managing money. The net profit margin is an important indicator when diving into the financial health of a company. Overall, you want to see the net profit margin rising over the years. That means the company improved their production and made it more efficient (if possible).

You can use the net profit margin to compare companies within the same industry. If there are two companies where one is much bigger but the smaller one has a higher net profit margin, that means the smaller company is more efficiently using operational costs.

Important: Profit margins can be very different between industries. Companies with assembly lines or transports are much more prone to see shifting in prices for fuel, ingredients and maintenance compared to companies that only provide services. You should never compare net profit margin between different industries.

1.1.2. Return on Assets

Shows how efficient Merck is using its assets to generate profit.

Above 5% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
2.8% Return on Assets means that Merck generated $0.03 profit for each $1 in assets.

Let's take a look of the Return on Assets trends of Merck & Company Inc:

The MRQ is 2.8%. Using its assets, the company is less efficient in making profit.
The TTM is 3.4%. Using its assets, the company is less efficient in making profit.

Trends

Current period		Compared to		+/-
MRQ	2.8%	TTM	3.4%	-0.6%
TTM	3.4%	YOY	3.4%	0.0%
TTM	3.4%	5Y	2.8%	+0.6%
5Y	2.8%	10Y	2.8%	0.0%

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	2.8%	2.5%	+0.3%
TTM	3.4%	2.8%	+0.6%
YOY	3.4%	3.2%	+0.2%
5Y	2.8%	2.8%	+0.0%
10Y	2.8%	2.4%	+0.4%

Shows how efficient Merck is using its assets to generate profit.

For a farm, a tractor is considered an asset. The tractor helps ploughing the land making it possible to plant and harvest crops. But the tractor might be old and needing maintenance all the time reducing its efficiency. Return on assets indicates how effectively the farm is using the tractor (and other assets that help the core business) to plough the land.

How to use return on assets

Higher is better.
Above 5% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
Can be very different between industries.
Can be used to compare companies.

Why do investors use return on assets in their analysis

Shows the investor how effectively Merck is using its resources to generate profit. If the return on assets (2.8%) from Merck are higher than the Drug Manufacturers-General mean (2.5%) that means Merck is using its resources better than their competitors. If not, that means their competitors are more efficient in using their resources to generate profit.

An investor should always look at:

What is the current return on assets?
The current most recent quarter (MRQ) Return on Assets of Merck is 2.8%. This means the company generated $0.03 for each $1 in assets.
How does it compare to the industry?
The mean MRQ Return on Assets of the Drug Manufacturers-General industry is 2.5%.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry.
If a company has many assets changing over time, it’s better to calculate the average assets instead of the total assets.

How to calculate return on assets

Return on assets = net income / total assets * 100%

Real example Merck

You need the following data to determine return on assets (ROA):

Income statement
Balance sheet

Net income MRQ (income statement) from Merck = 3,017,000
Total assets MRQ (balance sheet) from Merck = 109,160,000
3,017,000 / 109,160,000 = 0.03 or 2.8%

ROA is an important ratio as it will tell you how effectively Merck is using its resources to generate profits. Example:

Bob and Kristin both sell ice cream in the summer. They both have an ice cream truck. The truck Bob owes cost him $20.000 and the truck Kristin owes cost her $1500. Over the summer, Bob earned $2000 and Kristin earned $200. To calculate the return on assets:

Bob: $2000 / $20.000 * 100% = 10%
Kristin: $200 / $1500 * 100% = 13.3%

This tells you Bob’s company is more valuable but Kristin's company is more efficient. Be aware that total assets can change over time. A transportation business will buy and sell trucks or planes all the time. Before using return on assets as a guideline, you have to know what the exact assets are. For a company that has many assets changing over time, it’s better to calculate the average assets instead of the total assets.

1.1.3. Return on Equity

Shows how efficient Merck is using its investors money to generate profit.

Above 15%-20% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
6.6% Return on Equity means Merck generated $0.07 for each $1 the owners (shareholders) invested.

Let's take a look of the Return on Equity trends of Merck & Company Inc:

The MRQ is 6.6%. Using its investors money, the company is less efficient in making profit.
The TTM is 8.4%. Using its investors money, the company is less efficient in making profit.

Trends

Current period		Compared to		+/-
MRQ	6.6%	TTM	8.4%	-1.8%
TTM	8.4%	YOY	9.8%	-1.4%
TTM	8.4%	5Y	7.4%	+0.9%
5Y	7.4%	10Y	7.4%	0.0%

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	6.6%	5.2%	+1.4%
TTM	8.4%	6.6%	+1.8%
YOY	9.8%	7.1%	+2.7%
5Y	7.4%	6.2%	+1.2%
10Y	7.4%	6.3%	+1.1%

Shows how efficient Merck is using its investors money to generate profit.

A publicly traded company (any company that issues shares to the public) is owned by its shareholders. Return on equity calculates the amount of profit for every $1 the shareholders invested.

How to use return on equity

Higher is better.
Above 15%-20% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
Can be very different between industries.
Can be used to compare companies.

Why do investors use return on equity in their analysis

To find out the owners/management's attitude toward their company. You typically want the owners/management to invest in the company and focus on generating profit. If not enough profit is generated (compared to the Drug Manufacturers-General industry mean), the company might not be investing their money efficiently.

The three steps every investor should look at:

What is the current return on equity?
The current most recent quarter (MRQ) Return on Equity of Merck is 6.6%. This means Merck generated $0.07 for each $1 the owners (shareholders) invested.
How does it compare to the industry?
The mean MRQ Return on Equity of the Drug Manufacturers-General industry is 5.2%.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if Merck existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry.
Does not include intangible assets (non physical assets like licences, computer software, etc.).
Stockholders equity and shareholders equity refer to the same thing.
Liabilities should not be more than three times return on equity.

How to calculate return on equity

Return on equity = net profit / shareholders equity * 100%

Real example of Merck

You need the following data to determine ROE:

Income statement
Balance sheet
Net profit MRQ (income statement) Merck = 3,017,000
Shareholders equity (balance sheet) MRQ Merck = 45,991,000
3,017,000 / 45,991,000 = 0.07 or 6.6%

A negative shareholder equity is a warning sign. It means the company has more liabilities than assets. It might also mean that the owners did not invest enough money or they are taking money out of the business.

1.2. Operating Efficiency of Merck & Company Inc.

1.2. Operating Efficiency

1.2.1. Operating Margin

Measures how efficient Merck is operating .

Measures how much profit Merck makes for each $1 of sales after paying variable costs (production costs, wages, etc) but before taxes.
Above 15% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
An Operating Margin of 0.0% means the company generated $0.00 for each $1 in revenue (before taxes).

Let's take a look of the Operating Margin trends of Merck & Company Inc:

The MRQ is 0.0%. The data is not here.

Trends

Current period		Compared to		+/-
MRQ	-	TTM	26.9%	-26.9%
TTM	26.9%	YOY	32.4%	-5.5%
TTM	26.9%	5Y	26.4%	+0.5%
5Y	26.4%	10Y	26.4%	0.0%

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	-	22.0%	-22.0%
TTM	26.9%	17.2%	+9.7%
YOY	32.4%	22.4%	+10.0%
5Y	26.4%	20.1%	+6.3%
10Y	26.4%	20.1%	+6.3%

Measures how efficient Merck is operating .

The more effecient a company creates products or provides services, the more profit it generates.

How to use operating margin

Higher is better
Above 15% is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
Can be very different between industries
Can be used to compare companies

Why do investors use operating margin in their analysis

To determine how much profit Merck is making from it’s core business.

The three steps every investor should look at:

What is the current net profit margin?
The current most recent quarter (MRQ) Operating Margin of Merck is 0.0%. This means that Merck earned $0.00 for each $1 in revenue in the most recent quarter.
How does it compare to the industry?
The mean MRQ Operating Margin of the Drug Manufacturers-General industry is 22.0%.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry
Can be calculated in different ways

How to calculate operating margin

Operating margin = operating earnings / total revenue

Real example of Merck

You need the following data to determine operating margin:

Income statement
Operating earnings MRQ Merck = 3,487,000
Total revenue MRQ Merck = 13,830,000
$3,487,000 / $13,830,000 = 0.00 or 0.0%

Operating margin is used to calculate how much profit a company makes after variable costs of production but before paying interest and taxes. Some variable costs examples are wages, raw materials, packaging, and transaction fees. The amount of variable costs is different for each company and industry. In general, a higher operating margin is better as this implicates that a company is running efficiently.

For investors, a higher operating margin is a good sign. Although you should always look at operating margin in the long term. If operating margin is fluctuating over the years this might be a sign that things are not running efficiently enough. It’s a way to check how much profit a company is making from its core business.

Operation earnings can be calculated in multiple ways:

Operation earnings = EBIT - non operating income + non operating expense
Operation earnings = Gross profit - operating expense - depreciation and amortisation
Operation earnings = Total revenue - COGS (costs of goods sold) - indirect costs

1.2.2. Operating Ratio

Measures how efficient Merck is keeping operating costs low.

Below 1 is considered healthy (always compare to Drug Manufacturers-General industry mean).
An Operation Ratio of 1.03 means that the operating costs are $1.03 for each $1 in net sales.

Let's take a look of the Operating Ratio trends of Merck & Company Inc:

The MRQ is 1.028. The company is inefficient in keeping operating costs low. -1
The TTM is 0.986. The company is less efficient in keeping operating costs low.

Trends

Current period		Compared to		+/-
MRQ	1.028	TTM	0.986	+0.043
TTM	0.986	YOY	1.013	-0.027
TTM	0.986	5Y	1.061	-0.075
5Y	1.061	10Y	1.061	0.000

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	1.028	0.965	+0.063
TTM	0.986	0.963	+0.023
YOY	1.013	0.982	+0.031
5Y	1.061	0.956	+0.105
10Y	1.061	0.894	+0.167

Measures how efficient Merck is keeping operating costs low.

If the operating ratio is below 1 that means the company is making money. The lower the operating ratio, the more efficient the company.

How to use operating ratio

Lower is better.
Below 1 is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
Can be very different between industries.
Can be used to compare companies.

Why do investors use operating ratio in their analysis

Shows if costs of creating products and or services is increasing or decreasing. The lower the operating ratio, the more efficient the company is creating products and services.

The three steps every investor should look at:

What is the current Operatin ratio?
The current most recent quarter (MRQ) Operating Ratio of Merck is 102.8%. This means that Merck earned $1.03 for each $1 in net sales in the most recent quarter.
How does it compare to the industry?
The mean MRQ Operating Ratio of the Drug Manufacturers-General industry is 0.97.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry.
You need COGS to calculate operating ratio which is not always shown in the income statement.
Does not consider debt.

How to calculate operating ratio

Operating ratio = Operating expenses + COGS \ Net sales

Real life example Merck

You need the following data to determine operating ratio:

Income statement

COGS is not always specified on the income statement. If so you can use the following calculation:

(cost of revenue + total operating expenses) \ total revenue
(3,881,000 +10,343,000) \ 13,830,000 = 1.03

The operating ratio measures the efficiency of a company at keeping low costs while generating profits from sales. It compares the total operating expenses to the net amount of sales. The total operating expenses exists of:

COGS (materials, labour, rent of facility, repairs)
Operating expenses (legal fees, marketing, wages, rent, maintenance/repairs)

Operating expenses are all the costs the company makes that are not directly tied to the production of the service or product. Where COGS are costs that are directly tied to the production of a product or service.

Do note that COGS is not always available in the income statement. Some companies include COGS in the operating expenses while others list COGS separately. To make it even more confusing, COGS is also known as “costs of sales” and costs of sales is the same as costs of revenue.

The operating ratio tells you how efficient the company is creating its products or services while keeping prices low. In this case, a lower ratio is better. Higher or rising operating ratios might tell you that costs are rising while sales are not improving or staying the same.

1.3. Liquidity of Merck & Company Inc.

1.3. Liquidity

1.3.1. Current Ratio

Measures if Merck is able to pay off Short-term Debt.

Above 1.5 is considered healthy (always compare to Drug Manufacturers-General industry mean).
A Current Ratio of 1.47 means the company has $1.47 in assets for each $1 in short-term debts.

Let's take a look of the Current Ratio trends of Merck & Company Inc:

The MRQ is 1.474. The company is just able to pay all its short-term debts.
The TTM is 1.429. The company is just able to pay all its short-term debts.

Trends

Current period		Compared to		+/-
MRQ	1.474	TTM	1.429	+0.045
TTM	1.429	YOY	1.227	+0.203
TTM	1.429	5Y	1.294	+0.135
5Y	1.294	10Y	1.294	0.000

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	1.474	1.645	-0.171
TTM	1.429	1.574	-0.145
YOY	1.227	1.495	-0.268
5Y	1.294	1.743	-0.449
10Y	1.294	1.589	-0.295

Measures if Merck is able to pay off Short-term Debt.

How to use current ratio

Higher is better
Above 1.5 is considered healthy (always compare to Drug Manufacturers-General industry mean).
Can be very different between industries
Can be used to compare companies

Why do investors use current ratio in their analysis

Shows if the company can pay of short term debts if needed. A company that can't pay off it's short term debts might get in trouble if they have to pay off their short term debts for whatever reason. For example, markets can change due to global events like covid-19 or the war in Ukraine versus Russia. Because debts are always taken based on future income, it might become troublesome for Merck if something happens in the market that will cause sales to plummet.

The three steps every investor should look at:

What is the current current Ratio?
The current most recent quarter (MRQ) Current Ratio of Merck is 1.47. This means Merck has $1.47 in assets for each $1 in short-term debts.
How does it compare to the industry?
The mean MRQ Current Ratio of the Drug Manufacturers-General industry is 1.65.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry.
Might be deluded.
Not all assets can always be quickly sold.
Can be manipulated by increasing or decreasing the assets and/or liabilities.

How to calculate current ratio

Current ratio = current assets \ current liabilities

Real life example Merck

You need the following data to determine operating ratio:

Balance sheet
Current ratio = current assets \ current liabilities
35,722,000 \ 24,239,000) = 1.47

The current ratio measures if Merck is able to pay short-term debts (obligations). Short term in this context means all debt obligations that are about to expire within one year. The current ratio incorporates current liabilities and current assets. Current assets are all the assets a company has that are expected to be consumed or sold within standard business operations. You can find the current assets in the balance sheet. They consist of:

Inventory
Accounts receivable
Marketable securities
Prepaid expenses
Cash
Cash equivalents
liquid assets

The current liabilities are short term obligations that are due within one year. These consist of:

Short term debts
Dividends
Income taxes
Short-term debts
Accounts payable
Interest payments

The result shows an investor if Merck is able to pay all its short-term debts if they were due all at once. When the result of the above formula is below 1, then Merck does not have enough capital after selling all its assets to pay all short-term debts. If the ratio drops far below 1 that might indicate Merck is or will be in financial trouble anytime soon.

Although this gives an investor some clues, the current ratio may also be deluded. Because owning assets does not mean the company can easily sell them. Also, Accounts receivable may be quite old (they will probably never pay) which deludes the current ratio. As with all ratios, you should only compare them between the same industries and companies.

1.3.2. Quick Ratio

Measures if Merck is able to pay off Short-term Debt but only using the most liquid assets.

Above 1 is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
A Quick Ratio of 0.41 means the company can pay off $0.41 for each $1 in debt (using most liquid assets).

Let's take a look of the Quick Ratio trends of Merck & Company Inc:

The MRQ is 0.410. The company is just not able to pay all its short-term debts with the most liquid assets. -1
The TTM is 0.473. The company is just not able to pay all its short-term debts with the most liquid assets. -1

Trends

Current period		Compared to		+/-
MRQ	0.410	TTM	0.473	-0.062
TTM	0.473	YOY	0.402	+0.070
TTM	0.473	5Y	0.422	+0.051
5Y	0.422	10Y	0.422	0.000

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	0.410	0.833	-0.423
TTM	0.473	0.916	-0.443
YOY	0.402	0.983	-0.581
5Y	0.422	0.967	-0.545
10Y	0.422	0.981	-0.559

1.4. Solvency of Merck & Company Inc.

1.3. Liquidity

1.4.1. Debt to Asset Ratio

Measures how much % of Merck assets are financed with debt.

Below 1 (100%) is considered healthy but always compare Merck to Drug Manufacturers-General industry mean.
A Debt to Asset Ratio of 0.58 means that Merck assets are financed with 57.8% credit (debt) and the remaining percentage (100% - 57.8%) is financed by its owners/shareholders.

Let's take a look of the Debt to Asset Ratio trends of Merck & Company Inc:

The MRQ is 0.578. The company is able to pay all its debts by selling its assets. +1
The TTM is 0.593. The company is able to pay all its debts by selling its assets. +1

Trends

Current period		Compared to		+/-
MRQ	0.578	TTM	0.593	-0.015
TTM	0.593	YOY	0.647	-0.054
TTM	0.593	5Y	0.636	-0.042
5Y	0.636	10Y	0.636	0.000

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	0.578	0.514	+0.064
TTM	0.593	0.501	+0.092
YOY	0.647	0.522	+0.125
5Y	0.636	0.532	+0.104
10Y	0.636	0.525	+0.111

Measures how much % of Merck assets are financed with debt.

When there are more debts than assets, that means creditors have a larger stake Merck than its shareholders.

How to use debt to asset ratio

Lower is better.
below 1 (100%) is considered healthy but always compare Merck to Drug Manufacturers-General industry mean.
Can be very different between industries.
Can be used to compare companies.

Why do investors use the debt to asset ratio in their analysis

It shows how much debt the company used to finance its assets. If a company is almost entirely financed with debt that means the company might get into serious trouble when emergencies arise like a raise in interest.

The three steps every investor should look at:

What is the current debt to asset ratio?
The current most recent quarter (MRQ) Debt to Asset Ratio of Merck is 0.58. This means means that Merck is financed with 57.8% credit and the remaining percentage is financed by it's owners (shareholders).
How does it compare to the industry?
The mean MRQ Current Ratio of the Drug Manufacturers-General industry is 164.5%.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry
Some companies can have higher debt to assets ratio's (for example, banks).
Debt to asset ratio should improve over the years.
If the debt to asset ratio is above 1, look at the industry mean and find out why Merck has so much debt.

How to calculate debt to asset ratio

Debt to asset ratio = total debt \ total assets

Real life example Merck

You need the following data to determine debt to asset ratio:

Balance sheet
Debt to asset ratio = total debt \ total assets
63,102,000 \ 109,160,000 = 57.8% or 0.58.

The debt to total assets ratio shows if the company is owned by creditors or shareholders. Or in other words, the total debt in relation to the total amount of assets. It shows how much debt the company used to finance its assets.

1.4.2. Debt to Equity Ratio

Measures if Merck is able to pay off its debts by using shareholders equity.

Below 2 is considered healthy but always compare Merck to the Drug Manufacturers-General industry mean.
A Debt to Equity ratio of 137.2% means that company has $1.37 debt for each $1 in shareholders equity.

Let's take a look of the Debt to Equity Ratio trends of Merck & Company Inc:

The MRQ is 1.372. The company is able to pay all its debts with equity. +1
The TTM is 1.465. The company is able to pay all its debts with equity. +1

Trends

Current period		Compared to		+/-
MRQ	1.372	TTM	1.465	-0.093
TTM	1.465	YOY	1.866	-0.401
TTM	1.465	5Y	1.801	-0.336
5Y	1.801	10Y	1.801	0.000

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
MRQ	1.372	1.059	+0.313
TTM	1.465	1.008	+0.457
YOY	1.866	1.101	+0.765
5Y	1.801	1.166	+0.635
10Y	1.801	1.152	+0.649

Measures if Merck is able to pay off its debts by using shareholders equity.

How to use debt to equity ratio

Lower is better.
Below 2 is considered healthy (always use industry average).
Can be very different between industries.
Can be used to compare companies.

Why do investors use the debt to shareholders equity ratio in their analysis

It shows how much debt the company uses to finance their operations. Shareholders equity is whats left over when you subtract total liabilities from total assets. It's another way to meassure how much of Merck is financed with debt or own resources.

The three steps every investor should look at:

What is the current debt to equity ratio?
The current most recent quarter (MRQ) quickRatio of Merck is 1.37. This means that Merck can pay off $1.37 for each $1 in debt.
How does it compare to the industry?
The mean MRQ Quick Ratio of the Drug Manufacturers-General industry is 1.06.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry.
Not all debt is equally risky (for example, short term risk is less risky).

How to calculate debt to equity ratio

Debt to equity ratio = total debt \ shareholders equity.

Real life example Merck

You need the following data to determine equity ratio:

Balance sheet
Debt to equity ratio = total debt \ shareholders equity
63,102,000 \ 45,991,000 = 1.37 or 137.2%

Debt to equity measures the total debt versus the total shareholders equity. While the total debts to total assets ratio uses total assets, the debt to equity ratio looks at the total equity of shareholders. Where equity of shareholders are:

Common shares.
Preferred shares.
Retained earnings.

You can find the shareholders' equity in the balance sheet. A ratio between 0,5 and 1,5 is preferred. If the ratio is above 1.5, that would indicate creditors have significantly more stake (debt) in the company than the shareholders. In other words, the company is using a lot of debt to finance their operations.

Not all debt is equally risky. Meaning you can adjust the ratio by including or excluding certain amounts of debt. Short term debts are less risky because they have to be paid back within one year anyway. It’s much easier to plan one year ahead versus five or ten years.

2. Market Valuation of Merck & Company Inc

2. Earnings Per Share

2.1. Price to Earnings Ratio

Measures how much money you pay for each share for every $1 in earnings Merck generates.

Above 15 is considered overpriced but always compare Merck to the Drug Manufacturers-General industry mean.
A PE ratio of 0.00 means the investor is paying $0.00 for every $1 in earnings.

Let's take a look of the Price to Earnings Ratio trends of Merck & Company Inc:

The EOD is 92.361. Neutral. Compare to industry.
The MRQ is 0.000. The data is not here.

Trends

Current period		Compared to		+/-
EOD	92.361	MRQ	-	+92.361
MRQ	-	TTM	16.129	-16.129
TTM	16.129	YOY	23.362	-7.232
TTM	16.129	5Y	15.796	+0.333
5Y	15.796	10Y	15.796	0.000

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
EOD	92.361	43.525	+48.836
MRQ	-	45.468	-45.468
TTM	16.129	40.422	-24.293
YOY	23.362	55.947	-32.585
5Y	15.796	58.003	-42.207
10Y	15.796	44.655	-28.859

Measures how much money you pay for each share for every $1 in earnings Merck generates.

Indicates if the company’s shares are under or overvalued.

How to use PE ratio

Above 15 is considered overpriced but is hard to determine. Always compare Merck to the Drug Manufacturers-General industry mean.
Can be very different between industries.
Can be used to compare companies.

Why do investors use PE ratio in their analysis

The PE ratio tells investors the current sentiment in the market for that company. As with every stock, the stock price never shows the real valuation of a company but rather how the market thinks how much the stock is worth.

In other words, the current stock price also incorporates any future earnings or business opportunities in the future. The best example is the stock market crash in 2000. The PE ratio for any internet based company was going through the roof. Only based on the general assumption the internet and all associated businesses would thrive in the future. But this was based on nothing. A business still needs a good product or service to be able to survive. Instead, every investor bought any stock which did something related to the internet. Result: huge market crash.

Many investors were willing to pay premium prices and that was causing the PE ratio to rise. A high PE ratio is a warning sign that investors might be overvaluing a stock based on future earnings.

The three steps every investor should look at:

What is the current PE Ratio?
The current most recent quarter (MRQ) PE Ratio of Merck is 0.00. This means the investor is paying $0.00 for every $1 in earnings.
How does it compare to the industry?
The mean MRQ Quick Ratio of the Drug Manufacturers-General industry is 45.47.
What is the trend?
The trend is important because it shows you how Merck is performing over time. The most recent quarter might be important if Merck released a new product or service. And you can use MRQ to see if they performed better vs last year. You can find all the trends for Merck up to 10 years back (depending if the company existed 10 years ago) when you exit this learning section.

Things to be aware of

Only compare with other companies in the same industry.
Some industries might have very high or very low PE ratios in general.
PE ratios can be high for several years, it does not mean a sudden collapse is imminent.
Earnings growth is not included in the PE ratio.

How to calculate PE ratio

PE ratio = market value per share \ earnings per share

Real life example Merck

You need the following data to determine the PE ratio:

Balance sheet
Income statement

The PE ratio is a very commonly used ratio to determine the value of a company by comparing the current stock price relative to its earnings per share (EPS). Before we can calculate the PE ratio we need to know the EPS. EPS is calculated as follows:

EPS = (net profit - preferred dividends) \ end of period outstanding shares*
Net profit = revenue - expenses
\ 2,537,834 = EPS
PE ratio MRQ = 0.00

* The net profit minus preferred dividends can be found in the incomestatement as netIncomeApplicableToCommonShares.

The PE value helps investors to determine if the current stock price is under or overvalued. It also projects future growth.

In general, a higher PE ratio means that investors predict higher future growth. If the PE ratio is too high, then investors expect way too much future growth the company can never fulfil. This is most likely to happen in faster moving companies like tech companies or automobile companies like Tesla. These are hot and booming markets where investors expect much future growth driven by new technology (electric cars). When looking at the current MRQ (most recent quarter) PE ratio of Tesla ( jan. 2021) it's about 247 while the average in the industry is only 6. That might be a clue that Tesla is trading for way too high prices compared to their current assets and is more based on future growth.

2. Book Value per Share

2.3. Price to Book Ratio

Measures if the stock price of Merck is to cheap or to expensive compared to its book value.

At or below 1 is considered healthy (always compare to Drug Manufacturers-General industry mean).
A PB ratio of 0.00 means the investor is paying $0.00 for each $1 in book value.

Let's take a look of the Price to Book Ratio trends of Merck & Company Inc:

The EOD is 6.050. Seems overpriced? -1
The MRQ is 0.000. The data is not here.

Trends

Current period		Compared to		+/-
EOD	6.050	MRQ	-	+6.050
MRQ	-	TTM	1.177	-1.177
TTM	1.177	YOY	2.601	-1.425
TTM	1.177	5Y	1.511	-0.335
5Y	1.511	10Y	1.511	0.000

Compared to industry (Drug Manufacturers-General)

Period	Company	Industry (mean)	+/-
EOD	6.050	3.670	+2.380
MRQ	-	3.827	-3.827
TTM	1.177	3.943	-2.766
YOY	2.601	3.565	-0.964
5Y	1.511	3.967	-2.456
10Y	1.511	5.112	-3.601

2. Total Gains per Share

3. Summary

3.1. Key Performance Indicators

The key performance indicators of Merck & Company Inc compared to the Most Recent Quarter (MRQ).

	End of day	+/-	Most Recent Quarter	Trailing 12 Months	+/-	Year-Over-Year	+/-	5 Year	+/-	10 Year	+/-
Book Value Change Per Share	-	-	0.588	0.765	-23%	1.267	-54%	1.815	-68%	1.815	-68%
Book Value Growth	-	-	1.034	1.048	-1%	1.110	-7%	1.055	-2%	1.055	-2%
Book Value Per Share	-	-	18.149	17.237	+5%	13.267	+37%	14.358	+26%	14.358	+26%
Book Value Per Share Growth	-	-	1.033	1.047	-1%	1.110	-7%	1.055	-2%	1.055	-2%
Current Ratio	-	-	1.474	1.429	+3%	1.227	+20%	1.294	+14%	1.294	+14%
Debt To Asset Ratio	-	-	0.578	0.593	-3%	0.647	-11%	0.636	-9%	0.636	-9%
Debt To Equity Ratio	-	-	1.372	1.465	-6%	1.866	-26%	1.801	-24%	1.801	-24%
Dividend Per Share	-	-	0.690	0.691	0%	0.651	+6%	0.659	+5%	0.659	+5%
Dividend Per Share Growth	-	-	1.001	1.016	-2%	1.016	-2%	1.014	-1%	1.014	-1%
Eps	-	-	1.189	1.431	-17%	1.287	-8%	1.121	+6%	1.121	+6%
Free Cash Flow Per Share	-	-	1.293	1.450	-11%	0.953	+36%	1.085	+19%	1.085	+19%
Free Cash Flow Per Share Growth	-	-	0.732	0.993	-26%	1.504	-51%	1.531	-52%	1.531	-52%
Free Cash Flow To Equity Per Share	-	-	0.681	0.551	+24%	1.996	-66%	1.045	-35%	1.045	-35%
Free Cash Flow To Equity Per Share Growth	-	-	0.973	1.085	-10%	1.903	-49%	1.685	-42%	1.685	-42%
Gross Profit Margin	-	-	1.000	1.000	0%	1.000	0%	1.000	0%	1.000	0%
Intrinsic Value_10Y_max	-	-	13.827	-	-	-	-	-	-	-	-
Intrinsic Value_10Y_min	-	-	13.593	-	-	-	-	-	-	-	-
Intrinsic Value_1Y_max	-	-	5.168	-	-	-	-	-	-	-	-
Intrinsic Value_1Y_min	-	-	5.078	-	-	-	-	-	-	-	-
Intrinsic Value_3Y_max	-	-	12.644	-	-	-	-	-	-	-	-
Intrinsic Value_3Y_min	-	-	12.130	-	-	-	-	-	-	-	-
Intrinsic Value_5Y_max	-	-	16.646	-	-	-	-	-	-	-	-
Intrinsic Value_5Y_min	-	-	15.699	-	-	-	-	-	-	-	-
Net Profit Margin	-	-	0.218	0.244	-11%	0.256	-15%	0.207	+6%	0.207	+6%
Operating Margin	-	-	-	0.269	-100%	0.324	-100%	0.264	-100%	0.264	-100%
Operating Ratio	-	-	1.028	0.986	+4%	1.013	+2%	1.061	-3%	1.061	-3%
Pb Ratio	6.050	+100%	-	1.177	-100%	2.601	-100%	1.511	-100%	1.511	-100%
Pe Ratio	92.361	+100%	-	16.129	-100%	23.362	-100%	15.796	-100%	15.796	-100%
Price Per Share	109.800	+100%	-	20.663	-100%	37.988	-100%	23.460	-100%	23.460	-100%
Profit Growth	-	-	0.929	0.954	-3%	1.946	-52%	1.209	-23%	1.209	-23%
Quick Ratio	-	-	0.410	0.473	-13%	0.402	+2%	0.422	-3%	0.422	-3%
Return On Assets	-	-	0.028	0.034	-18%	0.034	-19%	0.028	-2%	0.028	-2%
Return On Equity	-	-	0.066	0.084	-22%	0.098	-33%	0.074	-12%	0.074	-12%
Revenue Growth	-	-	0.925	1.011	-9%	1.023	-10%	1.015	-9%	1.015	-9%
Total Gains Per Share	-	-	1.277	1.456	-12%	1.919	-33%	2.474	-48%	2.474	-48%
Total Gains Per Share Growth	-	-	1.097	0.960	+14%	1.838	-40%	1.235	-11%	1.235	-11%
Usd Book Value	-	-	46058000000.000	43713250000.000	+5%	33636750000.000	+37%	36407400000.000	+27%	36407400000.000	+27%
Usd Book Value Change Per Share	-	-	0.588	0.765	-23%	1.267	-54%	1.815	-68%	1.815	-68%
Usd Book Value Per Share	-	-	18.149	17.237	+5%	13.267	+37%	14.358	+26%	14.358	+26%
Usd Dividend Per Share	-	-	0.690	0.691	0%	0.651	+6%	0.659	+5%	0.659	+5%
Usd Eps	-	-	1.189	1.431	-17%	1.287	-8%	1.121	+6%	1.121	+6%
Usd Free Cash Flow	-	-	3281000000.000	3676750000.000	-11%	2415250000.000	+36%	2751700000.000	+19%	2751700000.000	+19%
Usd Free Cash Flow Per Share	-	-	1.293	1.450	-11%	0.953	+36%	1.085	+19%	1.085	+19%
Usd Free Cash Flow To Equity Per Share	-	-	0.681	0.551	+24%	1.996	-66%	1.045	-35%	1.045	-35%
Usd Price Per Share	109.800	+100%	-	20.663	-100%	37.988	-100%	23.460	-100%	23.460	-100%
Usd Profit	-	-	3017000000.000	3629750000.000	-17%	3262250000.000	-8%	2841500000.000	+6%	2841500000.000	+6%
Usd Revenue	-	-	13830000000.000	14820750000.000	-7%	12539250000.000	+10%	13450600000.000	+3%	13450600000.000	+3%
Usd Total Gains Per Share	-	-	1.277	1.456	-12%	1.919	-33%	2.474	-48%	2.474	-48%
	EOD	+1 -3	MRQ	TTM	+12 -27	YOY	+16 -23	5Y	+20 -19	10Y	+20 -19

3.2. Fundamental Score

Let's check the fundamental score of Merck & Company Inc based on Penke's default stock scanner.

Penke's Stock Scanner

Indicator	Condition		Value
Price to Earnings Ratio (EOD)	Between	0-15	92.361
Price to Book Ratio (EOD)	Between	0-1	6.050
Net Profit Margin (MRQ)	Greater than	0	0.218
Operating Margin (MRQ)	Greater than	0	0.000
Quick Ratio (MRQ)	Greater than	1	0.410
Current Ratio (MRQ)	Greater than	1	1.474
Debt to Asset Ratio (MRQ)	Less than	1	0.578
Debt to Equity Ratio (MRQ)	Less than	1	1.372
Return on Equity (MRQ)	Greater than	0.15	0.066
Return on Assets (MRQ)	Greater than	0.05	0.028
Total			3/10 (30.0%)

Create your own Stock Scanner

Investing is personal. The best investors buy stocks based on their own analysis. Create your personal Stock Scanner with the key performance indicators that are important to you.
Create your own Stock Scanner

3.3. Technical Score

Let's check the technical score of Merck & Company Inc based on Penke's default Symbol scanner.

Penke's Symbol Scanner

Indicator	Condition		Value
Rsi	Greater than	50	74.966
Ma 20	Greater than	Ma 50	91.640
Ma 50	Greater than	Ma 100	84.233
Ma 100	Greater than	Ma 200	78.169
Open	Greater than	Close	111.500
Total			4/5 (80.0%)

Create your own Symbol Scanner

Trading is personal. The best traders buy and sell based on their own technical analysis. Create your personal Symbol Scanner with the technical indicators that are important to you.
Create your own Symbol Scanner

Latest Balance Sheet

Balance Sheet of 2022-12-31. Currency in USD. All numbers in thousands.

Summary

Total Assets	109,160,000
Total Liabilities	63,102,000
Total Stockholder Equity	45,991,000

	As reported
Total Liabilities	63,102,000
Total Stockholder Equity	+ 45,991,000
Total Assets	= 109,160,000

Assets

Total Assets	109,160,000
Total Current Assets	35,722,000
Long-term Assets	35,722,000

Total Current Assets

Total Current Assets (as reported)	35,722,000
Cash And Cash Equivalents	12,694,000
Short-term Investments	498,000
Net Receivables	9,450,000
Inventory	5,911,000
Other Current Assets	7,169,000
Total Current Assets (calculated)	35,722,000
+/-	0

Long-term Assets

Long-term Assets (as reported)	73,438,000
Goodwill	21,204,000
Long Term Investments	1,015,000
Intangible Assets	20,269,000
Long-term Assets Other	9,528,000
Long-term Assets (calculated)	52,016,000
+/-	21,422,000

Liabilities & Shareholders' Equity

Total Current Liabilities	24,239,000
Long-term Liabilities	38,863,000
Total Stockholder Equity	45,991,000

Total Current Liabilities

Total Current Liabilities (as reported)	24,239,000
Short Long Term Debt	1,946,000
Accounts payable	4,264,000
Total Current Liabilities (calculated)	6,210,000
+/-	18,029,000

Long-term Liabilities

Long-term Liabilities (as reported)	38,863,000
Long term Debt	28,745,000
Long-term Liabilities Other	8,323,000
Long-term Liabilities (calculated)	37,068,000
+/-	1,795,000

Total Stockholder Equity

Total Stockholder Equity (as reported)	45,991,000
Retained Earnings	61,081,000
Total Stockholder Equity (calculated)	61,081,000
+/-	15,090,000

Other

Capital Stock	1,788,000
Common Stock Shares Outstanding	2,537,834
Net Debt	17,997,000
Net Invested Capital	76,682,000
Net Working Capital	11,483,000

Balance Sheet

Currency in USD. All numbers in thousands.

Trend

2022-12-31

2022-09-30

2022-06-30

2022-03-31

2021-12-31

2021-09-30

2021-06-30

2021-03-31

2020-12-31

2020-09-30

> Total Assets

89,800,000
91,588,000
90,847,000
90,688,000
93,494,000
105,694,000
106,668,000
107,095,000
107,081,000
109,160,000

109,160,000

107,081,000

107,095,000

106,668,000

105,694,000

93,494,000

90,688,000

90,847,000

91,588,000

89,800,000

> Total Current Assets

26,577,000
27,764,000
26,909,000
28,665,000
31,058,000
30,266,000
31,184,000
32,116,000
33,561,000
35,722,000

35,722,000

33,561,000

32,116,000

31,184,000

30,266,000

31,058,000

28,665,000

26,909,000

27,764,000

26,577,000

Cash And Cash Equivalents

7,356,000
8,062,000
6,981,000
8,575,000
10,016,000
8,096,000
8,556,000
9,675,000
11,145,000
12,694,000

12,694,000

11,145,000

9,675,000

8,556,000

8,096,000

10,016,000

8,575,000

6,981,000

8,062,000

7,356,000

Short-term Investments

0
0
0
0
0
0
372,000
453,000
103,000
498,000

498,000

103,000

453,000

372,000

Net Receivables

8,422,000
8,288,000
8,692,000
8,378,000
10,581,000
10,779,000
11,192,000
10,983,000
10,685,000
9,450,000

9,450,000

10,685,000

10,983,000

11,192,000

10,779,000

10,581,000

8,378,000

8,692,000

8,288,000

8,422,000

Inventory

8,209,000
6,310,000
6,402,000
5,499,000
5,603,000
5,953,000
5,774,000
5,535,000
5,614,000
5,911,000

5,911,000

5,614,000

5,535,000

5,774,000

5,953,000

5,603,000

5,499,000

6,402,000

6,310,000

8,209,000

Other Current Assets

2,590,000
5,103,000
4,818,000
6,201,000
4,832,000
5,424,000
5,286,000
5,469,000
6,014,000
7,169,000

7,169,000

6,014,000

5,469,000

5,286,000

5,424,000

4,832,000

6,201,000

4,818,000

5,103,000

2,590,000

> Long-term Assets

63,223,000
63,824,000
63,938,000
62,023,000
62,436,000
75,428,000
75,484,000
74,979,000
73,520,000
73,438,000

73,438,000

73,520,000

74,979,000

75,484,000

75,428,000

62,436,000

62,023,000

63,938,000

63,824,000

63,223,000

Property Plant Equipment

0
19,711,000
18,295,000
18,064,000
18,565,000
20,865,000
19,747,000
20,059,000
20,424,000
0

20,424,000

20,059,000

19,747,000

20,865,000

18,565,000

18,064,000

18,295,000

19,711,000

Goodwill

20,248,000
20,238,000
20,212,000
18,873,000
18,862,000
21,264,000
21,258,000
21,213,000
21,160,000
21,204,000

21,204,000

21,160,000

21,213,000

21,258,000

21,264,000

18,862,000

18,873,000

20,212,000

20,238,000

20,248,000

Long Term Investments

1,372,000
785,000
544,000
411,000
435,000
370,000
316,000
238,000
984,000
1,015,000

1,015,000

984,000

238,000

316,000

370,000

435,000

411,000

544,000

785,000

1,372,000

Intangible Assets

16,677,000
14,604,000
14,401,000
13,622,000
13,384,000
22,933,000
23,022,000
22,497,000
21,368,000
20,269,000

20,269,000

21,368,000

22,497,000

23,022,000

22,933,000

13,384,000

13,622,000

14,401,000

14,604,000

16,677,000

Long-term Assets Other

8,007,000
10,211,000
10,486,000
11,053,000
11,190,000
11,582,000
11,141,000
10,972,000
9,584,000
9,528,000

9,528,000

9,584,000

10,972,000

11,141,000

11,582,000

11,190,000

11,053,000

10,486,000

10,211,000

8,007,000

> Total Liabilities

60,530,000
66,184,000
63,808,000
57,300,000
57,631,000
67,437,000
65,715,000
63,777,000
62,557,000
63,102,000

63,102,000

62,557,000

63,777,000

65,715,000

67,437,000

57,631,000

57,300,000

63,808,000

66,184,000

60,530,000

> Total Current Liabilities

20,405,000
27,327,000
26,361,000
21,906,000
23,728,000
23,872,000
22,316,000
23,168,000
22,998,000
24,239,000

24,239,000

22,998,000

23,168,000

22,316,000

23,872,000

23,728,000

21,906,000

26,361,000

27,327,000

20,405,000

Short Long Term Debt

2,420,000
6,431,000
7,251,000
2,488,000
3,534,000
2,412,000
1,208,000
2,979,000
1,936,000
1,946,000

1,946,000

1,936,000

2,979,000

1,208,000

2,412,000

3,534,000

2,488,000

7,251,000

6,431,000

2,420,000

Accounts payable

3,744,000
4,594,000
4,034,000
3,897,000
4,248,000
6,389,000
6,026,000
4,621,000
3,973,000
4,264,000

4,264,000

3,973,000

4,621,000

6,026,000

6,389,000

4,248,000

3,897,000

4,034,000

4,594,000

3,744,000

Other Current Liabilities

0
4,567,000
4,181,000
3,838,000
4,341,000
3,276,000
3,802,000
3,866,000
4,503,000
0

4,503,000

3,866,000

3,802,000

3,276,000

4,341,000

3,838,000

4,181,000

4,567,000

> Long-term Liabilities

40,125,000
38,857,000
37,447,000
35,394,000
33,903,000
43,565,000
43,399,000
40,609,000
39,559,000
38,863,000

38,863,000

39,559,000

40,609,000

43,399,000

43,565,000

33,903,000

35,394,000

37,447,000

38,857,000

40,125,000

Long term Debt

26,321,000
25,360,000
24,002,000
24,033,000
22,907,000
30,690,000
30,586,000
28,684,000
28,482,000
28,745,000

28,745,000

28,482,000

28,684,000

30,586,000

30,690,000

22,907,000

24,033,000

24,002,000

25,360,000

26,321,000

Other Liabilities

0
12,135,000
13,445,000
11,361,000
10,996,000
11,650,000
12,813,000
11,925,000
11,077,000
0

11,077,000

11,925,000

12,813,000

11,650,000

10,996,000

11,361,000

13,445,000

12,135,000

Long-term Liabilities Other

12,027,000
12,482,000
12,241,000
9,872,000
9,469,000
9,434,000
9,742,000
8,951,000
8,660,000
8,323,000

8,323,000

8,660,000

8,951,000

9,742,000

9,434,000

9,469,000

9,872,000

12,241,000

12,482,000

12,027,000

> Total Stockholder Equity

29,186,000
25,317,000
26,945,000
33,294,000
35,794,000
38,184,000
40,883,000
43,243,000
44,458,000
45,991,000

45,991,000

44,458,000

43,243,000

40,883,000

38,184,000

35,794,000

33,294,000

26,945,000

25,317,000

29,186,000

Common Stock

0
1,788,000
1,788,000
1,788,000
1,788,000
1,788,000
1,788,000
1,788,000
1,788,000
0

1,788,000

Retained Earnings

51,107,000
47,362,000
48,888,000
48,777,000
51,691,000
53,696,000
56,252,000
58,437,000
59,928,000
61,081,000

61,081,000

59,928,000

58,437,000

56,252,000

53,696,000

51,691,000

48,777,000

48,888,000

47,362,000

51,107,000

Capital Surplus

Treasury Stock

Other Stockholders Equity

-4,743,000

-4,327,000

-4,369,000

-4,429,000

-4,590,000

-4,628,000

-6,622,000

-6,634,000

Balance Sheet

Currency in USD. All numbers in thousands.

	2022-12-31	2021-12-31	2020-12-31	2019-12-31	2018-12-31	2017-12-31
Accounts Payable	4,264,000	6,389,000	4,665,000	4,315,000	4,098,000	3,102,000
Capital Stock	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	-
Cash	12,694,000	8,096,000	8,062,000	9,676,000	7,965,000	6,092,000
Common Stock	-	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000
Common Stock Shares Outstanding	2,537,834	2,527,604	2,530,226	2,539,016	2,592,560	2,696,612
Good Will	21,204,000	21,264,000	20,238,000	19,425,000	18,253,000	18,284,000
Intangible Assets	20,269,000	22,933,000	14,604,000	14,196,000	11,431,000	14,183,000
Inventory	5,911,000	5,953,000	5,554,000	5,978,000	5,440,000	5,096,000
Long Term Debt	28,745,000	30,690,000	25,360,000	22,736,000	19,806,000	21,353,000
Long Term Investments	1,015,000	370,000	785,000	1,469,000	6,233,000	12,125,000
Net Debt	17,997,000	25,006,000	23,729,000	16,670,000	17,149,000	18,318,000
Net Invested Capital	76,682,000	71,286,000	57,108,000	52,253,000	51,815,000	58,746,000
Net Receivables	9,450,000	10,779,000	7,240,000	7,105,000	7,226,000	6,918,000
Net Tangible Assets	-	-6,013,000	-7,666,000	-7,714,000	-4,656,000	1,869,000
Net Working Capital	11,483,000	6,394,000	437,000	5,263,000	3,669,000	6,152,000
Non Current Assets Total	73,438,000	75,428,000	63,824,000	56,914,000	56,762,000	63,106,000
Non Current Liabilities Other	8,323,000	9,434,000	12,482,000	11,970,000	12,041,000	11,117,000
Non Current Liabilities Total	38,863,000	43,565,000	38,857,000	36,176,000	33,549,000	34,689,000
Non Currrent Assets Other	9,528,000	11,582,000	10,211,000	6,771,000	7,554,000	6,075,000
Other Assets	-	9,400,000	10,728,000	5,263,000	5,313,000	6,075,000
Other Current Assets	7,169,000	5,424,000	6,919,000	3,950,000	4,345,000	4,254,000
Other Current Liab	-	3,276,000	4,917,000	3,152,000	3,614,000	2,192,000
Other Liab	-	11,650,000	12,162,000	12,672,000	13,662,000	13,284,000
Other Stockholder Equity	-	-4,429,000	-6,634,000	-6,193,000	-5,545,000	-4,910,000
Property Plant Equipment	-	20,865,000	18,688,000	16,126,000	13,291,000	12,439,000
Retained Earnings	61,081,000	53,696,000	47,362,000	46,602,000	42,579,000	41,350,000
Short Long Term Debt	1,946,000	2,412,000	6,431,000	3,610,000	5,308,000	3,057,000
Short Term Investments	498,000	-	0	774,000	899,000	2,406,000
Total Assets	109,160,000	105,694,000	91,588,000	84,397,000	82,637,000	87,872,000
Total Current Assets	35,722,000	30,266,000	27,764,000	27,483,000	25,875,000	24,766,000
Total Current Liabilities	24,239,000	23,872,000	27,327,000	22,220,000	22,206,000	18,614,000
Total Liab	63,102,000	67,437,000	66,184,000	58,396,000	55,755,000	53,303,000
Total Stockholder Equity	45,991,000	38,184,000	25,317,000	25,907,000	26,701,000	34,336,000

	2022-12-31	2022-09-30	2022-06-30	2022-03-31	2021-12-31	2021-09-30	2021-06-30	2021-03-31	2020-12-31	2020-09-30
Accounts Payable	4,264,000	3,973,000	4,621,000	6,026,000	6,389,000	4,248,000	3,897,000	4,034,000	4,594,000	3,744,000
Capital Stock	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	-	-	-
Cash	12,694,000	11,145,000	9,675,000	8,556,000	8,096,000	10,016,000	8,575,000	6,981,000	8,062,000	7,356,000
Common Stock	-	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	1,788,000	-
Common Stock Shares Outstanding	2,537,834	2,533,406	2,533,209	2,528,376	2,527,604	2,525,323	2,532,752	2,531,304	2,530,226	2,529,760
Good Will	21,204,000	21,160,000	21,213,000	21,258,000	21,264,000	18,862,000	18,873,000	20,212,000	20,238,000	20,248,000
Intangible Assets	20,269,000	21,368,000	22,497,000	23,022,000	22,933,000	13,384,000	13,622,000	14,401,000	14,604,000	16,677,000
Inventory	5,911,000	5,614,000	5,535,000	5,774,000	5,953,000	5,603,000	5,499,000	6,402,000	6,310,000	8,209,000
Long Term Debt	28,745,000	28,482,000	28,684,000	30,586,000	30,690,000	22,907,000	24,033,000	24,002,000	25,360,000	26,321,000
Long Term Investments	1,015,000	984,000	238,000	316,000	370,000	435,000	411,000	544,000	785,000	1,372,000
Net Debt	17,997,000	19,273,000	21,988,000	23,238,000	25,006,000	16,425,000	17,946,000	24,272,000	23,729,000	21,385,000
Net Invested Capital	76,682,000	74,876,000	74,906,000	72,677,000	71,286,000	62,235,000	59,815,000	58,198,000	57,108,000	57,927,000
Net Receivables	9,450,000	10,685,000	10,983,000	11,192,000	10,779,000	10,581,000	8,378,000	8,692,000	8,288,000	8,422,000
Net Tangible Assets	-	1,930,000	-467,000	-6,013,000	-6,013,000	3,548,000	799,000	-7,668,000	-9,525,000	-
Net Working Capital	11,483,000	10,563,000	8,948,000	8,868,000	6,394,000	7,330,000	6,759,000	548,000	437,000	6,172,000
Non Current Assets Total	73,438,000	73,520,000	74,979,000	75,484,000	75,428,000	62,436,000	62,023,000	63,938,000	63,824,000	63,223,000
Non Current Liabilities Other	8,323,000	8,660,000	8,951,000	9,742,000	9,434,000	9,469,000	9,872,000	12,241,000	12,482,000	12,027,000
Non Current Liabilities Total	38,863,000	39,559,000	40,609,000	43,399,000	43,565,000	33,903,000	35,394,000	37,447,000	38,857,000	40,125,000
Non Currrent Assets Other	9,528,000	9,584,000	10,972,000	11,141,000	11,582,000	11,190,000	11,053,000	10,486,000	10,211,000	8,007,000
Other Assets	-	8,224,000	9,496,000	9,298,000	9,400,000	10,612,000	10,335,000	9,807,000	7,846,000	-
Other Current Assets	7,169,000	6,014,000	5,469,000	5,286,000	5,424,000	4,832,000	6,201,000	4,818,000	5,103,000	2,590,000
Other Current Liab	-	4,503,000	3,866,000	3,802,000	3,276,000	4,341,000	3,838,000	4,181,000	4,567,000	-
Other Liab	-	11,077,000	11,925,000	12,813,000	11,650,000	10,996,000	11,361,000	13,445,000	12,135,000	-
Other Stockholder Equity	-	-4,743,000	-4,327,000	-4,369,000	-4,429,000	-4,590,000	-4,628,000	-6,622,000	-6,634,000	-
Property Plant Equipment	-	20,424,000	20,059,000	19,747,000	20,865,000	18,565,000	18,064,000	18,295,000	19,711,000	-
Retained Earnings	61,081,000	59,928,000	58,437,000	56,252,000	53,696,000	51,691,000	48,777,000	48,888,000	47,362,000	51,107,000
Short Long Term Debt	1,946,000	1,936,000	2,979,000	1,208,000	2,412,000	3,534,000	2,488,000	7,251,000	6,431,000	2,420,000
Short Term Investments	498,000	103,000	453,000	372,000	-	-	-	-	0	0
Total Assets	109,160,000	107,081,000	107,095,000	106,668,000	105,694,000	93,494,000	90,688,000	90,847,000	91,588,000	89,800,000
Total Current Assets	35,722,000	33,561,000	32,116,000	31,184,000	30,266,000	31,058,000	28,665,000	26,909,000	27,764,000	26,577,000
Total Current Liabilities	24,239,000	22,998,000	23,168,000	22,316,000	23,872,000	23,728,000	21,906,000	26,361,000	27,327,000	20,405,000
Total Liab	63,102,000	62,557,000	63,777,000	65,715,000	67,437,000	57,631,000	57,300,000	63,808,000	66,184,000	60,530,000
Total Stockholder Equity	45,991,000	44,458,000	43,243,000	40,883,000	38,184,000	35,794,000	33,294,000	26,945,000	25,317,000	29,186,000

Cash Flow

Currency in USD. All numbers in thousands.

	2022-12-31	2021-12-31	2020-12-31	2019-12-31	2018-12-31	2017-12-31
Begin Period Cash Flow	8,167,000	8,165,000	9,934,000	7,967,000	6,096,000	6,515,000
Capital Expenditures	4,388,000	4,448,000	4,429,000	3,369,000	2,615,000	1,888,000
Change In Cash	4,606,000	14,000	-1,781,000	1,967,000	1,871,000	-419,000
Change In Working Capital	-2,782,000	-3,839,000	-4,590,000	-2,067,000	-1,553,000	-5,021,000
Change To Account Receivables	-644,000	-2,033,000	-1,002,000	92,000	-418,000	297,000
Change To Inventory	-161,000	-674,000	-895,000	-473,000	-911,000	-145,000
Change To Liabilities	-	405,000	684,000	443,000	230,000	254,000
Change To Netincome	-	1,776,000	4,557,000	2,597,000	1,735,000	4,458,000
Change To Operating Activities	-	-997,000	-4,202,000	-250,000	-1,281,000	-2,132,000
Depreciation	3,909,000	3,123,000	3,218,000	3,077,000	4,520,000	4,616,000
Dividends Paid	7,012,000	6,610,000	6,215,000	5,695,000	5,172,000	5,167,000
End Period Cash Flow	12,773,000	8,167,000	8,165,000	9,934,000	7,967,000	6,092,000
Free Cash Flow	14,707,000	9,661,000	5,569,000	9,967,000	8,307,000	4,559,000
Investments	-4,960,000	1,025,000	1,717,000	5,420,000	7,258,000	4,925,000
Net Borrowings	-	1,631,000	5,011,000	1,248,000	837,000	-1,129,000
Net Income	14,519,000	13,049,000	7,067,000	9,843,000	6,220,000	2,394,000
Other Cashflows From Financing Activities	-	8,210,000	-436,000	5,000	-325,000	-195,000
Other Cashflows From Investing Activities	-	-225,000	-125,000	274,000	102,000	38,000
Other Non Cash Items	1,301,000	2,361,000	2,611,000	1,177,000	1,628,000	769,000
Sale Purchase Of Stock	0	-840,000	-1,281,000	-4,780,000	-9,091,000	-4,014,000
Stock Based Compensation	541,000	479,000	475,000	417,000	-	-
Total Cash From Financing Activities	-9,119,000	2,593,000	-2,832,000	-8,861,000	-13,160,000	-10,006,000
Total Cash From Operating Activities	19,095,000	14,109,000	10,241,000	13,440,000	10,922,000	6,451,000
Total Cashflows From Investing Activities	-	-16,555,000	-9,443,000	-2,629,000	4,314,000	2,679,000

	2022-12-31	2022-09-30	2022-06-30	2022-03-31	2021-12-31	2021-09-30	2021-06-30	2021-03-31	2020-12-31	2020-09-30
Begin Period Cash Flow	11,279,000	9,753,000	8,614,000	8,167,000	10,046,000	8,630,000	7,023,000	8,165,000	7,401,000	11,147,000
Capital Expenditures	1,149,000	1,126,000	1,129,000	984,000	1,208,000	1,208,000	934,000	1,134,000	1,514,000	1,516,000
Change In Cash	1,494,000	1,526,000	1,139,000	447,000	-1,879,000	-1,879,000	1,619,000	-1,142,000	764,000	-3,746,000
Change In Working Capital	-347,000	263,000	-1,399,000	-1,299,000	-45,000	-139,000	-1,551,000	-2,104,000	1,048,000	-1,445,000
Change To Account Receivables	-	-	-	-	-2,033,000	-2,033,000	-2,033,000	-2,033,000	-1,002,000	-
Change To Inventory	-	-	-	-	-674,000	-674,000	-674,000	-674,000	-855,000	-
Change To Liabilities	-	0	0	0	405,000	0	0	0	724,000	-
Change To Netincome	-	1,153,000	866,000	659,000	514,000	514,000	773,000	-194,000	4,224,000	-
Change To Operating Activities	-	263,000	-1,399,000	-1,299,000	2,797,000	2,797,000	-1,551,000	-2,104,000	1,621,000	-
Depreciation	892,000	938,000	891,000	1,091,000	804,000	804,000	672,000	910,000	828,000	852,000
Dividends Paid	1,750,000	1,747,000	1,770,000	1,745,000	1,643,000	1,643,000	1,673,000	1,645,000	1,542,000	1,545,000
End Period Cash Flow	12,773,000	11,279,000	9,753,000	8,614,000	8,167,000	10,046,000	8,630,000	7,023,000	8,165,000	7,401,000
Free Cash Flow	3,281,000	4,476,000	3,173,000	3,777,000	3,823,000	3,625,000	1,556,000	657,000	2,492,000	657,000
Investments	-1,748,000	330,000	40,000	-371,000	529,000	529,000	529,000	385,000	-99,000	-2,155,000
Net Borrowings	-	-1,000,000	-1,000,000	-1,250,000	6,767,000	6,767,000	-4,771,000	-365,000	2,857,000	-
Net Income	3,017,000	3,248,000	3,944,000	4,310,000	3,758,000	4,567,000	1,545,000	3,179,000	-2,094,000	2,941,000
Other Cashflows From Financing Activities	-	35,000	-104,000	-103,000	-33,000	-33,000	8,903,000	-97,000	36,000	-
Other Cashflows From Investing Activities	-	-45,000	12,000	182,000	-106,000	-106,000	404,000	25,000	-11,000	-
Other Non Cash Items	132,000	393,000	633,000	143,000	306,000	1,025,000	1,361,000	-331,000	3,056,000	-243,000
Sale Purchase Of Stock	0	0	-	-	-18,000	-583,000	-239,000	0	0	0
Stock Based Compensation	145,000	139,000	137,000	120,000	119,000	-	-	-	-	-
Total Cash From Financing Activities	-1,554,000	-2,702,000	-1,777,000	-3,086,000	5,207,000	5,207,000	2,262,000	-2,098,000	1,372,000	-3,851,000
Total Cash From Operating Activities	4,430,000	5,602,000	4,302,000	4,761,000	5,031,000	5,031,000	1,439,000	1,791,000	4,006,000	2,173,000
Total Cashflows From Investing Activities	-	-962,000	-1,077,000	-1,173,000	-12,049,000	-12,049,000	-2,160,000	-738,000	-4,778,000	-

Income Statement

Currency in USD. All numbers in thousands.

	2022-12-31	2021-12-31	2020-12-31	2019-12-31	2018-12-31	2017-12-31
Cost Of Revenue	17,411,000	13,626,000	15,485,000	14,112,000	13,509,000	12,775,000
Discontinued Operations	-	704,000	2,548,000	4,153,000	4,153,000	-
Ebit	-	15,857,000	11,242,000	10,638,000	10,102,000	8,001,000
Ebitda	21,315,000	13,199,000	13,247,000	16,009,000	13,992,000	11,912,000
Gross Profit	41,872,000	35,078,000	32,509,000	32,728,000	28,785,000	27,347,000
Income Before Tax	16,444,000	13,879,000	8,791,000	11,464,000	8,701,000	6,521,000
Income Tax Expense	-	1,521,000	1,340,000	1,565,000	2,508,000	4,103,000
Interest Expense	962,000	806,000	831,000	893,000	772,000	0
Interest Income	157,000	36,000	59,000	274,000	343,000	385,000
Minority Interest	-7,000	691,000	-15,000	66,000	27,000	-24,000
Net Income	14,519,000	13,049,000	7,067,000	9,843,000	6,220,000	2,394,000
Net Income Applicable To Common Shares	-	13,049,000	7,067,000	9,843,000	6,220,000	2,394,000
Net Income From Continuing Ops	14,526,000	12,358,000	7,082,000	9,777,000	6,193,000	2,418,000
Net Interest Income	-805,000	-770,000	-772,000	-619,000	-429,000	-369,000
Operating Income	18,282,000	13,199,000	8,483,000	12,241,000	8,931,000	7,309,000
Reconciled Depreciation	3,909,000	3,214,000	3,625,000	3,652,000	4,519,000	4,637,000
Research Development	13,548,000	12,245,000	13,558,000	9,872,000	9,752,000	10,208,000
Selling General Administrative	10,042,000	9,634,000	10,468,000	10,615,000	10,102,000	9,830,000
Tax Provision	1,918,000	1,521,000	1,709,000	1,687,000	2,508,000	4,103,000
Total Operating Expenses	41,001,000	35,505,000	39,511,000	34,599,000	33,363,000	32,813,000
Total Other Income Expense Net	-1,033,000	680,000	1,080,000	-158,000	199,000	-419,000
Total Revenue	59,283,000	48,704,000	47,994,000	46,840,000	42,294,000	40,122,000

	2022-12-31	2022-09-30	2022-06-30	2022-03-31	2021-12-31	2021-09-30	2021-06-30	2021-03-31	2020-12-31	2020-09-30
Cost Of Revenue	3,881,000	3,934,000	4,216,000	5,380,000	3,873,000	3,450,000	3,104,000	3,670,000	5,533,000	3,481,000
Discontinued Operations	-	-	-	-	-62,000	-62,000	332,000	434,000	434,000	-
Ebit	-	5,146,000	5,293,000	5,889,000	4,322,000	5,043,000	3,850,000	3,095,000	3,304,000	-
Ebitda	4,640,000	4,106,000	5,067,000	5,622,000	3,750,000	4,923,000	2,609,000	4,592,000	-882,000	4,483,000
Gross Profit	9,949,000	11,025,000	10,377,000	10,521,000	9,648,000	9,704,000	8,298,000	8,410,000	6,982,000	9,070,000
Income Before Tax	3,513,000	3,583,000	4,487,000	4,861,000	3,909,000	5,266,000	1,717,000	3,462,000	-1,993,000	3,428,000
Income Tax Expense	-	330,000	538,000	554,000	85,000	695,000	503,000	238,000	98,000	-
Interest Expense	235,000	244,000	240,000	243,000	209,000	196,000	202,000	200,000	207,000	203,000
Interest Income	95,000	40,000	15,000	7,000	9,000	7,000	9,000	11,000	11,000	9,000
Minority Interest	-1,000	-5,000	-5,000	3,000	-66,000	-4,000	331,000	-7,000	-3,000	-4,000
Net Income	3,017,000	3,248,000	3,944,000	4,310,000	3,758,000	4,567,000	1,545,000	3,179,000	-2,094,000	2,941,000
Net Income Applicable To Common Shares	-	3,248,000	3,944,000	4,310,000	3,758,000	4,567,000	1,545,000	3,179,000	-2,094,000	-
Net Income From Continuing Ops	3,018,000	3,253,000	3,949,000	4,307,000	3,824,000	4,571,000	1,214,000	3,186,000	-2,091,000	2,945,000
Net Interest Income	-140,000	-204,000	-225,000	-236,000	-200,000	-189,000	-193,000	-189,000	-196,000	-194,000
Operating Income	3,487,000	4,106,000	5,067,000	5,622,000	3,750,000	4,923,000	1,696,000	3,312,000	-1,940,000	3,230,000
Reconciled Depreciation	892,000	959,000	938,000	1,120,000	835,000	759,000	690,000	930,000	904,000	852,000
Research Development	3,775,000	4,399,000	2,798,000	2,576,000	3,068,000	2,445,000	4,321,000	2,465,000	5,837,000	3,390,000
Selling General Administrative	2,687,000	2,520,000	2,512,000	2,323,000	2,830,000	2,336,000	2,281,000	2,633,000	3,085,000	2,450,000
Tax Provision	495,000	330,000	538,000	554,000	85,000	695,000	503,000	276,000	98,000	483,000
Total Operating Expenses	10,343,000	10,853,000	9,526,000	10,279,000	9,771,000	8,231,000	9,706,000	8,768,000	14,455,000	9,321,000
Total Other Income Expense Net	166,000	-523,000	-580,000	-761,000	159,000	343,000	214,000	339,000	143,000	392,000
Total Revenue	13,830,000	14,959,000	14,593,000	15,901,000	13,521,000	13,154,000	11,402,000	12,080,000	12,515,000	12,551,000

Latest Income Statement (annual, 2022-12-31)

Gross Profit (+$)
totalRevenue	59,283,000
Cost of Revenue	-17,411,000
Gross Profit	41,872,000	41,872,000

Operating Income (+$)
Gross Profit	41,872,000
Operating Expense	-41,001,000
Operating Income	18,282,000	871,000

Operating Expense (+$)
Research Development	13,548,000
Selling General Administrative	10,042,000
Selling And Marketing Expenses	-
Operating Expense	41,001,000	23,590,000

Net Interest Income (+$)
Interest Income	157,000
Interest Expense	-962,000
Other Finance Cost	-0
Net Interest Income	-805,000

Pretax Income (+$)
Operating Income	18,282,000
Net Interest Income	-805,000
Other Non-Operating Income Expenses	-
Income Before Tax (EBT)	16,444,000	19,315,000 EBIT - interestExpense = -962,000 14,519,000 15,481,000
Interest Expense	962,000
Earnings Before Interest and Taxes (EBIT)	-	17,406,000
Earnings Before Interest and Taxes (EBITDA)	21,315,000

After tax Income (+$)
Income Before Tax	16,444,000
Tax Provision	-1,918,000
Net Income From Continuing Ops	14,526,000	14,526,000
Net Income	14,519,000
Net Income Applicable To Common Shares	-

Non-recurring Events
Discontinued Operations	-
Extraordinary Items	-
Effect of Accounting Charges	-
Other Items	-
Non Recurring	-
Other Operating Expenses	-
Total Other Income/Expenses Net	-1,033,000	805,000

Technicals of Merck

1. Trend Indicators

1.1 Moving Averages

Shows the moving average of the selected period.

Moving averages are lagging trend indicators.
There are many types of moving averages.
Moving averages are also used within other indicators.

Directionalities and relatives.

Moving Average	Amount of candles	vs. MA 50	vs. MA 100
MA 20	20
MA 50	50	-
MA 100	100	-	-

Explanation: https://www.youtube.com/watch?v=xwW8h0lrQ-I

Shows the moving average of the selected period.

There are four types of indicators:

Trend indicators
Momentum indicators
Volatility indicators
Volume indicators

There are various kinds of moving averages:

Simple moving average (SMA);
Exponential moving average (EMA);
Smoothed moving average (SMMA);
Linear weighted moving average (LWMA).

The moving average looks at a certain period of time and it calculates the price average. The various types of averages are using various formulas. Don’t worry, you don’t have to memorize any formula. All moving averages are calculated automatically by basically every charting software you use. But it’s good to know how moving averages are actually calculated.

Simple moving average

SMA is calculated by summing up the price closures of the selected period. The price is then divided by the selected period. For example, when using the 21 day moving average you sum up all the closing prices for each day and divide that by 21. The result is a line on the chart representing the average. Because it’s an average in the selected timeframe, the trend is always lagging. An moving average looks like this on the chart:

Source: Tradingview.com

In this case, the blue line represents a 21 day moving average. Because the average is based on results from the past, the indicator will always lag behind. For example, when price would suddenly go up, the moving average won't immediately follow.

All other moving averages discussed below look the same on the chart. The only difference is that the line will move in different directions based on the maths behind the used indicators and the amount of days used to determine the average.

Exponential moving average

The EMA gives more weight to the latest closing prices by giving them more value in the equation. EMA is calculated by adding a certain percentage to the latest closing prices:

EMA = (CLOSE (i) * P) + (EMA (i - 1) * (1 - P))

Where:

CLOSE (i) = current period close price.
EMA (i - 1) = value of the Moving Average of a preceding period.
P = the percentage of using the price value.

Smoothed moving average

A smoothed moving average is an exponential moving average with a long lookback period. Older prices are reduced in weight but are never left out in the calculation. Unlike SMA and EMA where prices are removed when they are beyond the selected period. SMMA is a combination of the SMA and EMA. The main advantage is that it smooths out fluctuations in price.

Linear weighted moving average

The LWMA gives the latest price the highest weight and then lineary scales down with each price before that. The result is that the LWMA reacts quicker to changes in price than the SMA or EMA. The formula:

LWMA = ((Pn∗W1)+(Pn−1∗W2)+(Pn−2∗W3)...) / ∑W

Where:

P = Price for the period.
n = The most recent period, n-1 is the prior period, and n-2 is two periods prior.
W = The assigned weight to each period, with the highest weight going first and then descending linearly based on the number of periods being used.

Moving averages are widely used by many traders. Which moving average you need depends on your trading strategy. Common practise is using a combination of multiple periods. For example, the EMA21, EMA50, EMA100 and EMA200. How does that look on a chart:

Source: Tradingview.com

The lowest (purple) line on the chart represents the EMA200 then following up the EMA100, EMA50 and EMA21.

You can use moving averages to determine a trend. The 200 moving average is mostly used as a baseline for determining the current trend:

When the 200 moving average is moving up it is considered a bullish trend.
When the 200 moving average is down it is considered a bearish trend.
When moving averages are flatlined, there is no clear trend so you should look for market structure, consolidation or trend reversals. Depending on how you want to trade.

This is not set in stone. Most trading strategies use multiple moving averages each with different settings. While one strategy might use the EMA20, the other uses the SMA21. There can be hundreds of different variations. Moving averages can also be used as support and resistance. More often than not, prices will bounce on moving averages.

Merck & Company Inc Daily Moving Averages Chart

1.2 Moving Average Convergence/Divergence (MACD)

Shows the momentum of the selected period based on two moving averages.

MACD is a lagging momentum indicator.
Uses two moving averages.
Can show buy or sell signals based on momentum.
Can show overbought. and oversold. levels.

Let's take a look of the Moving Average Convergence/Divergence (MACD) of Merck & Company Inc:

The Moving Average Convergence/Divergence (MACD) is 5.985. The Moving Average Convergence/Divergence (MACD) above zero is a bullish sign. +1
The MACD is higher than the signal line. This is a bullish indication. +1

Merck & Company Inc Daily Moving Average Convergence/Divergence (MACD) Chart

1.3 Directional Movement Index (DMI)

The DMI is a collection of 3 indicators: +DI (Plus Direction Indicator), -DI (Minus Direction Indicator) and ADX (Average Directional Index).

The ADX helps you determine the strength of a trend. Let's take a look of the ADX of Merck & Company Inc:

The ADX is 25.219. Strong Trend. +1
The ADX is rising, the current trend is strengthening. +1
The +DI is higher than the -DI. The current trend is up. +2

Merck & Company Inc Daily Directional Movement Index (DMI) Chart

1.4 Parabolic SAR

Shows the current trend and potential entry and exit signals.

Parabolic SAR (stop and reverse) is a lagging trend indicator.
Shows the current trend.
Shows potential entry signals.
Shows potential exit signals.
Can be used to place trailing stoplosses..

The Parabolic SAR is lower than the price. The current trend is up. +2

Merck & Company Inc Daily Parabolic SAR Chart

2. Momentum Indicators

2.1 Relative Strength Index (RSI)

Measures the speed and change of price movements.

Leading momentum indicator, meaning the signals are instant.
Ranges between 0 and 100.
Above 70 is considered overbought.
Below 30 is considered oversold.
Above or below 50 can also be used to determine price trend or support and resistance.
RSI divergence looks at a deviation between RSI and price movement. Penketrading automatically calculates RSI divergences.
Can be used in many different ways

The RSI is above 50. +1
The RSI is above 70 and overbought. +2

Measures the speed and change of price movements.

There are four types of indicators:

Trend indicators
Momentum indicators
Volatility indicators
Volume indicators

The RSI measures the magnitude of recent price changes to determine if the asset is overbought or oversold.

Overbought (RSI above 70) means that the trading price is above its intrinsic value. This might indicate a sell or short signal.
Oversold (RSI below 30) means that the trading price is below its intrinsic value. This might indicate a buy or long signal.
RSI levels above or below 50 can also be used to determine a trend.
RSI divergence looks at a deviation between RSI and price movement.
Can be used in many different ways.

Original usage

Keep in mind that almost every indicator can be used in different ways. Even beyond the orginal settings. The relative strength index was developed by J. Welles Wilder. Wilder recommended a smoothing period of 14 days. That means a 14 day moving average (read more about this setting below). Another quote from the wikipedia page:

Wilders also considers the RSI 50 line as both support and resistance. I recommend to always read the original settings first before using an indicator. Many traders and websites are using their own version of the indicator which might be confusing.

How you can use RSI (Divergence)

First and foremost, there is no real right or wrong usage of the RSI indicator. You can use it in any way you want. Wilder recommends using a 14 day average but you can make it 50 or 100 if you like. Just keep in mind that using an indicator is just part of a larger trading plan. In other words, it’s not recommended to do any trading or investing based on a single indicator like the RSI.

The RSI is measured on a scale between 0 and 100. From 30 till 0 is considered oversold. and from 70 -100 is overbought. The RSI is a leading indicator, meaning the signals are instant.

I like to use the RSI as a trend\momentum indicator and not as an overbought or oversold indicator. I use the middle (50) as the baseline. When prices go above RSI 50 the trend is bullish and can indicate long positions. When below 50 it is considered bearish and can indicate short positions. Other traders use the 70 and 30 levels as overbought/oversold depending on the used strategy. The RSI indicator looks like this:

Source: Tradingview.com

The general concensus is that an RSI above 70 indicates that the security is overbought. In other words, the price this security is trading for is to high and should come down. So if RSI hits 70 or above this might indicate a sell signal or taking a short position (expecting the price will go down). Although RSI above 70 indicates the security is trading above it's fair value, that does not mean the price will go down.

Use tradingview to add indicators

I highly recommend using tradingview to add indicators to a chart. It has all the indicators you can think off and can add them for free (up to three indicators) to any chart you want. You can see that the levels 30 and 70 are marked with a dotted line. If you want you can remove these lines or give it another colour using Tradingview. You can also adjust the moving average used. You can also find RSI indicators made by the community that include other settings like RSI divergences.

Tradingview

Use Tradingview to (back)test your strategies and add hundreds of indicators created by the community.

View tool on Tradingview.com

RSI divergence

RSI is not only used to determine momentum but can also spot reversals or continuations of the trend. A reversal means that the trend is going in the opposite direction. From bullish to bearish or from bearish to bullish. These reversals can be spotted by looking at the price and the direction of the RSI. When the price is going up but the RSI is going down that means there is a divergence. This is also the case when RSI goes up but price is going down.

There are four types of divergences:

Regular bullish divergence
Regular bearish divergence
Hidden bullish divergence
Hidden bearish divergence

Regular bullish divergence

With a regular bullish divergence, the price is making lower highs but the oscillator (in this case the RSI) is making higher lows. A regular bullish divergence might indicate the end of the current trend. You’ll see regular bullish divergences mostly at the end of a downtrend. But that does not mean that every regular bullish divergence is a trend reversal.

Price is making lower highs
RSI is making higher lows
Indicating bullish reversal (price might go up)

Source: Tradingview.com

Regular bearish divergence

With a regular bearish divergence the price is making higher highs but the oscillator (in this case the RSI) is making lower highs. This might indicate the end of an uptrend.

Price is making higher highs
RSI is making lower highs
Indicating bearish reversal

Source: Tradingview.com

Hidden bullish divergence

With a hidden bullish divergence, the price is making a higher low while the RSI is making a lower low. This might indicate bullish trend continuation.

Price is making higher lows
RSI is making lower lows
Indicating bullish continuation

Source: Tradingview.com

As you have noticed, you can have multiple divergences in a row.

Hidden bearish divergence

With a hidden bearish divergence, price is making lower highs but RSI is making higher highs. This might indicate bearish trend continuation.

Price is making lower highs
RSI making higher highs
Indicating bearish continuation

Source: Tradingview.com

You can find many cheatsheets of RSI divergences online. Search for "RSI divergence overview" and you'll find a lot of examples. You can print these to learn the various types of divergences.

Merck & Company Inc Daily Relative Strength Index (RSI) Chart

2.2 Stochastic Oscillator

Compares a certain price to multiple prices ranging over time.

Leading momentum indicator, meaning the signals are instant.
Used to determine overbought and oversold areas much like the RSI.
Ranges between 0 and 100.
Above 80 is considered overbought.
Below 20 is considered oversold.
Consists of two lines named K and D.
K compares the highest high and lowest low on the selected price range.
The D line is a moving average of the K line.
Can be used to spot divergences

The Stochastic is above 50. +1
The Stochastic is above 70 and overbought. +2

Merck & Company Inc Daily Stochastic Oscillator Chart

2.3 Commodity Channel Index (CCI)

Merck & Company Inc Daily Commodity Channel Index (CCI) Chart

2.4 Chande Momentum Oscillator (CMO)

Merck & Company Inc Daily Chande Momentum Oscillator (CMO) Chart

2.5 Williams %R

Merck & Company Inc Daily Williams %R Chart

3. Volatility Indicators

3.1 Bollinger Bands

Merck & Company Inc Daily Bollinger Bands Chart

3.2 Average True Range (ATR)

Merck & Company Inc Daily Average True Range (ATR) Chart

4. Volume Indicators

4.1 On-Balance Volume (OBV)

Merck & Company Inc Daily On-Balance Volume (OBV) Chart

4.2 Money Flow Index (MFI)

Merck & Company Inc Daily Money Flow Index (MFI) Chart

5. Summary

5.1. Notifications

Type	Notification	Date
Currently no notifications for Merck & Company Inc.

5.2. Trading Signals

Date	Indicator	Entry signal	Exit signal
2022-09-29	DMI	SHORT ENTRY	LONG CLOSE
	CCI	SHORT ENTRY	LONG CLOSE	-100 crossover to downside
2022-11-09	MACD	LONG ENTRY	SHORT CLOSE
	RSI	SHORT ENTRY	LONG CLOSE	70 crossover to downside
	STOCH	SHORT ENTRY	LONG CLOSE	80 crossover to downside
	WILLR	SHORT ENTRY	LONG CLOSE	-80 crossover to downside
	ATR	SHORT ENTRY	LONG CLOSE
2022-11-30	CMO	LONG ENTRY	SHORT CLOSE	50 crossover to upside
2022-12-05	CMO	LONG ENTRY	SHORT CLOSE	50 crossover to upside

5.2. Technical Score

Let's check the technical score of Merck & Company Inc based on Penke's default Symbol scanner.

Penke's Symbol Scanner

Indicator	Condition		Value
Rsi	Greater than	50	74.966
Ma 20	Greater than	Ma 50	91.640
Ma 50	Greater than	Ma 100	84.233
Ma 100	Greater than	Ma 200	78.169
Open	Greater than	Close	111.500
Total			4/5 (80.0%)

Create your own Symbol Scanner

Comments

Join the conversation.

Merck & Company Inc Buy, Hold or Sell?

Let's analyse Merck together

Get notifications about Merck & Company Inc

Quick analysis of Merck (30 sec.)

1. Valuation of Merck (5 min.)

$109.80

$18.15

2. Growth of Merck (5 min.)

Is Merck growing?

How much money is Merck making?

How much money comes from the company's main activities?

3. Financial Health of Merck (5 min.)

4. Comparing to competitors in the Drug Manufacturers-General industry (5 min.)

Industry Rankings (Drug Manufacturers-General)

Fundamentals of Merck

Financial Health

1.1. Profitability of Merck & Company Inc.

1.1. Profitability

1.1.1. Net Profit Margin

Trends

Compared to industry (Drug Manufacturers-General)

1.1.2. Return on Assets

Trends

Compared to industry (Drug Manufacturers-General)

1.1.3. Return on Equity

Trends

Compared to industry (Drug Manufacturers-General)

1.2. Operating Efficiency of Merck & Company Inc.

1.2. Operating Efficiency

1.2.1. Operating Margin

Trends

Compared to industry (Drug Manufacturers-General)

1.2.2. Operating Ratio

Trends

Compared to industry (Drug Manufacturers-General)

1.3. Liquidity of Merck & Company Inc.

1.3. Liquidity

1.3.1. Current Ratio

Trends

Compared to industry (Drug Manufacturers-General)

1.3.2. Quick Ratio

Trends

Compared to industry (Drug Manufacturers-General)

1.4. Solvency of Merck & Company Inc.

1.3. Liquidity

1.4.1. Debt to Asset Ratio

Trends

Compared to industry (Drug Manufacturers-General)

1.4.2. Debt to Equity Ratio

Trends

Compared to industry (Drug Manufacturers-General)

2. Market Valuation of Merck & Company Inc

2. Earnings Per Share

2.1. Price to Earnings Ratio

Trends

Compared to industry (Drug Manufacturers-General)

2. Book Value per Share

2.3. Price to Book Ratio

Trends

Compared to industry (Drug Manufacturers-General)

2. Total Gains per Share

3. Summary

3.1. Key Performance Indicators

3.2. Fundamental Score

Penke's Stock Scanner

Create your own Stock Scanner

Merck & Company Inc
Buy, Hold or Sell?