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Merck & Co., Inc. (MRK) vs Novo Nordisk A/S (NVO)

Merck & Co., Inc. and Novo Nordisk A/S are both Drug Manufacturers General companies. Merck & Co., Inc. is the larger, with a market value of $358.2B against $131.2B — 2.7× the size. Novo Nordisk A/S trades at the lower P/E: 9.5× against 117×. Novo Nordisk A/S grew revenue faster over the last twelve months: 13.2% against 4.64%. Novo Nordisk A/S has the higher net margin (35.5% vs 4.77%) and the higher return on invested capital (28.7% vs 5.08%). Both pay a dividend; Novo Nordisk A/S yields more (4.63% vs 2.33%). Across the 23 metrics below, Novo Nordisk A/S leads on 17 and Merck & Co., Inc. on 6.

Valuation

Metric MRK NVO Drug Manufacturers General median
P/E 116.76 9.49 24.54
P/S 5.42 3.35 3.39
P/B 8.59 5.00 5.00
Price to free cash flow 22.44 22.63 16.55
EV/EBITDA 29.52 7.04 13.82
EV/Sales 6.08 3.62 4.03
Earnings yield 0.86% 10.53% 2.98%
Free cash flow yield 4.46% 4.42% 4.46%

Profitability

Metric MRK NVO Drug Manufacturers General median
Gross margin 72.97% 80.73% 72.77%
Operating margin 10.49% 43.36% 18.77%
Net margin 4.77% 35.47% 8.27%
Free cash flow margin 24.13% 14.79% 17.18%
Return on equity 6.97% 60.84% 5.87%
Return on assets 2.57% 22.00% 2.57%
Return on invested capital 5.08% 28.67% 6.11%

Growth

Metric MRK NVO Drug Manufacturers General median
Revenue growth (TTM) 4.64% 13.15% 6.66%
EPS growth (last fiscal year) 8.01% 6.40% 21.81%
Revenue growth, 5-year CAGR 9.38% 19.20% 4.75%
Net income growth, 5-year CAGR 20.90% 19.16% 0.00%

Health

Metric MRK NVO Drug Manufacturers General median
Debt to equity 1.22 0.63 0.63
Current ratio 1.32 0.87 1.32
Net debt to EBITDA 1.15 0.65 1.15

Dividend

Metric MRK NVO Drug Manufacturers General median
Dividend yield 2.33% 4.63% 2.33%
Payout ratio 2.72 0.44 0.59

Size

Metric MRK NVO Drug Manufacturers General median
Market cap 358.21b 131.23b 123.73b

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