Eli Lilly and Company (LLY) vs Merck & Co., Inc. (MRK)

Eli Lilly and Company and Merck & Co., Inc. are both Drug Manufacturers General companies. Eli Lilly and Company is the larger, with a market value of $1.11T against $365.4B — 3.0× the size. Eli Lilly and Company trades at the lower P/E: 39.7× against 119×. Eli Lilly and Company grew revenue faster over the last twelve months: 49.6% against 4.64%. Eli Lilly and Company has the higher net margin (33.5% vs 4.77%) and the higher return on invested capital (26.3% vs 5.08%). Both pay a dividend; Merck & Co., Inc. yields more (2.58% vs 0.72%). Across the 23 metrics below, Eli Lilly and Company leads on 13 and Merck & Co., Inc. on 10.

Valuation

Metric LLY MRK Drug Manufacturers General median
P/E 39.71 119.02 24.72
P/S 13.26 5.52 3.35
P/B 31.17 8.75 5.00
Price to free cash flow 51.79 22.88 17.68
EV/EBITDA 30.84 30.03 13.91
EV/Sales 13.83 6.18 3.95
Earnings yield 2.52% 0.84% 2.92%
Free cash flow yield 1.93% 4.37% 4.42%

Profitability

Metric LLY MRK Drug Manufacturers General median
Gross margin 83.40% 72.97% 72.77%
Operating margin 42.22% 10.49% 18.90%
Net margin 33.53% 4.77% 8.27%
Free cash flow margin 22.83% 24.13% 17.25%
Return on equity 102.29% 6.97% 6.97%
Return on assets 21.97% 2.57% 2.76%
Return on invested capital 26.33% 5.08% 6.30%

Growth

Metric LLY MRK Drug Manufacturers General median
Revenue growth (TTM) 49.58% 4.64% 6.79%
EPS growth (last fiscal year) 95.99% 8.01% —
Revenue growth, 5-year CAGR 21.58% 9.38% 3.98%
Net income growth, 5-year CAGR 27.22% 20.90% 0.42%

Health

Metric LLY MRK Drug Manufacturers General median
Debt to equity 1.62 1.22 0.63
Current ratio 1.35 1.32 1.32
Net debt to EBITDA 1.19 1.15 1.15

Dividend

Metric LLY MRK Drug Manufacturers General median
Dividend yield 0.72% 2.58% 3.57%
Payout ratio 0.59 2.36 0.53

Size

Metric LLY MRK Drug Manufacturers General median
Market cap 1.11t 365.36b 125.91b

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