Stock Analysis on Net
Stock Analysis on Net

Merck & Co. Inc. (NYSE:MRK)

Adjusted Financial Ratios

Microsoft Excel

Adjusted Financial Ratios (Summary)

Merck & Co. Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Activity Ratio
Total Asset Turnover
Reported 0.56 0.54 0.46 0.52 0.55
Adjusted 0.57 0.54 0.46 0.53 0.56
Liquidity Ratio
Current Ratio
Reported 1.25 1.47 1.27 1.02 1.24
Adjusted 1.28 1.49 1.27 1.02 1.25
Solvency Ratios
Debt to Equity
Reported 0.93 0.67 0.87 1.26 1.02
Adjusted 0.96 0.66 0.83 1.27 0.98
Debt to Capital
Reported 0.48 0.40 0.46 0.56 0.50
Adjusted 0.49 0.40 0.45 0.56 0.50
Financial Leverage
Reported 2.84 2.37 2.77 3.62 3.26
Adjusted 2.78 2.26 2.52 3.46 3.02
Profitability Ratios
Net Profit Margin
Reported 0.61% 24.49% 26.79% 14.72% 21.01%
Adjusted -2.38% 21.56% 29.32% 11.93% 19.08%
Return on Equity (ROE)
Reported 0.97% 31.57% 34.17% 27.91% 37.99%
Adjusted -3.78% 26.50% 34.23% 21.78% 32.19%
Return on Assets (ROA)
Reported 0.34% 13.30% 12.35% 7.72% 11.66%
Adjusted -1.36% 11.72% 13.59% 6.30% 10.65%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Merck & Co. Inc. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Merck & Co. Inc. adjusted current ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. Merck & Co. Inc. adjusted debt-to-equity ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. Merck & Co. Inc. adjusted debt-to-capital ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Merck & Co. Inc. adjusted financial leverage ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Merck & Co. Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. Merck & Co. Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Merck & Co. Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.

Merck & Co. Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Sales 60,115 59,283 48,704 47,994 46,840
Total assets 106,675 109,160 105,694 91,588 84,397
Activity Ratio
Total asset turnover1 0.56 0.54 0.46 0.52 0.55
Adjusted
Selected Financial Data (US$ in millions)
Sales 60,115 59,283 48,704 47,994 46,840
Adjusted total assets2 105,357 109,022 105,080 90,861 83,935
Activity Ratio
Adjusted total asset turnover3 0.57 0.54 0.46 0.53 0.56

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Total asset turnover = Sales ÷ Total assets
= 60,115 ÷ 106,675 = 0.56

2 Adjusted total assets. See details »

3 2023 Calculation
Adjusted total asset turnover = Sales ÷ Adjusted total assets
= 60,115 ÷ 105,357 = 0.57

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Merck & Co. Inc. adjusted total asset turnover ratio improved from 2021 to 2022 and from 2022 to 2023.

Adjusted Current Ratio

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Current assets 32,168 35,722 30,266 27,764 27,483
Current liabilities 25,694 24,239 23,872 27,327 22,220
Liquidity Ratio
Current ratio1 1.25 1.47 1.27 1.02 1.24
Adjusted
Selected Financial Data (US$ in millions)
Adjusted current assets2 32,818 36,087 30,344 27,931 27,740
Current liabilities 25,694 24,239 23,872 27,327 22,220
Liquidity Ratio
Adjusted current ratio3 1.28 1.49 1.27 1.02 1.25

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Current ratio = Current assets ÷ Current liabilities
= 32,168 ÷ 25,694 = 1.25

2 Adjusted current assets. See details »

3 2023 Calculation
Adjusted current ratio = Adjusted current assets ÷ Current liabilities
= 32,818 ÷ 25,694 = 1.28

Liquidity ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Merck & Co. Inc. adjusted current ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023 not reaching 2021 level.

Adjusted Debt to Equity

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Total debt 35,055 30,691 33,102 31,791 26,346
Total Merck & Co., Inc. stockholders’ equity 37,581 45,991 38,184 25,317 25,907
Solvency Ratio
Debt to equity1 0.93 0.67 0.87 1.26 1.02
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total debt2 36,268 31,985 34,631 33,453 27,350
Adjusted total equity3 37,900 48,228 41,721 26,295 27,767
Solvency Ratio
Adjusted debt to equity4 0.96 0.66 0.83 1.27 0.98

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Debt to equity = Total debt ÷ Total Merck & Co., Inc. stockholders’ equity
= 35,055 ÷ 37,581 = 0.93

2 Adjusted total debt. See details »

3 Adjusted total equity. See details »

4 2023 Calculation
Adjusted debt to equity = Adjusted total debt ÷ Adjusted total equity
= 36,268 ÷ 37,900 = 0.96

Solvency ratio Description The company
Adjusted debt-to-equity ratio A solvency ratio calculated as adjusted total debt divided by adjusted total equity. Merck & Co. Inc. adjusted debt-to-equity ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Debt to Capital

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Total debt 35,055 30,691 33,102 31,791 26,346
Total capital 72,636 76,682 71,286 57,108 52,253
Solvency Ratio
Debt to capital1 0.48 0.40 0.46 0.56 0.50
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total debt2 36,268 31,985 34,631 33,453 27,350
Adjusted total capital3 74,168 80,213 76,352 59,748 55,117
Solvency Ratio
Adjusted debt to capital4 0.49 0.40 0.45 0.56 0.50

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 35,055 ÷ 72,636 = 0.48

2 Adjusted total debt. See details »

3 Adjusted total capital. See details »

4 2023 Calculation
Adjusted debt to capital = Adjusted total debt ÷ Adjusted total capital
= 36,268 ÷ 74,168 = 0.49

Solvency ratio Description The company
Adjusted debt-to-capital ratio A solvency ratio calculated as adjusted total debt divided by adjusted total debt plus adjusted total equity. Merck & Co. Inc. adjusted debt-to-capital ratio improved from 2021 to 2022 but then deteriorated significantly from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Total assets 106,675 109,160 105,694 91,588 84,397
Total Merck & Co., Inc. stockholders’ equity 37,581 45,991 38,184 25,317 25,907
Solvency Ratio
Financial leverage1 2.84 2.37 2.77 3.62 3.26
Adjusted
Selected Financial Data (US$ in millions)
Adjusted total assets2 105,357 109,022 105,080 90,861 83,935
Adjusted total equity3 37,900 48,228 41,721 26,295 27,767
Solvency Ratio
Adjusted financial leverage4 2.78 2.26 2.52 3.46 3.02

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Financial leverage = Total assets ÷ Total Merck & Co., Inc. stockholders’ equity
= 106,675 ÷ 37,581 = 2.84

2 Adjusted total assets. See details »

3 Adjusted total equity. See details »

4 2023 Calculation
Adjusted financial leverage = Adjusted total assets ÷ Adjusted total equity
= 105,357 ÷ 37,900 = 2.78

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Merck & Co. Inc. adjusted financial leverage ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.

Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Net income attributable to Merck & Co., Inc. 365 14,519 13,049 7,067 9,843
Sales 60,115 59,283 48,704 47,994 46,840
Profitability Ratio
Net profit margin1 0.61% 24.49% 26.79% 14.72% 21.01%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 (1,431) 12,782 14,282 5,727 8,937
Sales 60,115 59,283 48,704 47,994 46,840
Profitability Ratio
Adjusted net profit margin3 -2.38% 21.56% 29.32% 11.93% 19.08%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
Net profit margin = 100 × Net income attributable to Merck & Co., Inc. ÷ Sales
= 100 × 365 ÷ 60,115 = 0.61%

2 Adjusted net income. See details »

3 2023 Calculation
Adjusted net profit margin = 100 × Adjusted net income ÷ Sales
= 100 × -1,431 ÷ 60,115 = -2.38%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Merck & Co. Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Net income attributable to Merck & Co., Inc. 365 14,519 13,049 7,067 9,843
Total Merck & Co., Inc. stockholders’ equity 37,581 45,991 38,184 25,317 25,907
Profitability Ratio
ROE1 0.97% 31.57% 34.17% 27.91% 37.99%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 (1,431) 12,782 14,282 5,727 8,937
Adjusted total equity3 37,900 48,228 41,721 26,295 27,767
Profitability Ratio
Adjusted ROE4 -3.78% 26.50% 34.23% 21.78% 32.19%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
ROE = 100 × Net income attributable to Merck & Co., Inc. ÷ Total Merck & Co., Inc. stockholders’ equity
= 100 × 365 ÷ 37,581 = 0.97%

2 Adjusted net income. See details »

3 Adjusted total equity. See details »

4 2023 Calculation
Adjusted ROE = 100 × Adjusted net income ÷ Adjusted total equity
= 100 × -1,431 ÷ 37,900 = -3.78%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted total equity. Merck & Co. Inc. adjusted ROE deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Reported
Selected Financial Data (US$ in millions)
Net income attributable to Merck & Co., Inc. 365 14,519 13,049 7,067 9,843
Total assets 106,675 109,160 105,694 91,588 84,397
Profitability Ratio
ROA1 0.34% 13.30% 12.35% 7.72% 11.66%
Adjusted
Selected Financial Data (US$ in millions)
Adjusted net income2 (1,431) 12,782 14,282 5,727 8,937
Adjusted total assets3 105,357 109,022 105,080 90,861 83,935
Profitability Ratio
Adjusted ROA4 -1.36% 11.72% 13.59% 6.30% 10.65%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

1 2023 Calculation
ROA = 100 × Net income attributable to Merck & Co., Inc. ÷ Total assets
= 100 × 365 ÷ 106,675 = 0.34%

2 Adjusted net income. See details »

3 Adjusted total assets. See details »

4 2023 Calculation
Adjusted ROA = 100 × Adjusted net income ÷ Adjusted total assets
= 100 × -1,431 ÷ 105,357 = -1.36%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Merck & Co. Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.