reports
- Julie Utterback
Trimming Narrow-Moat Merck KGaA's Fair Value Estimate on Pending Versu...
After taking a fresh look at Merck KGaA following the Versum acquisition announcement, we are trimming our fair value estimate for the firm and boosting our uncertainty rating. Merck has offered a full valuation for Versum, which has cut into our fair value estimate slightly. Our new high uncertainty rating also recognizes Merck's increasing exposure to the cyclical semiconductor end market and the ongoing risks surrounding Merck's healthcare portfolio and display solutions business. Strategical...
- Julie Utterback
- Michael Waterhouse
- Michael Waterhouse
- Michael Waterhouse
Merck KGaA Posts Solid Fourth Quarter with 2019 Outlook Near Our Estim...
Merck KGaA wrapped up 2018 with results mostly in line with our expectations, including $3.8 billion in EBITDA for the year. Management’s outlook for this year of modestly positive revenue growth and high-single-digit EBITDA growth including modest currency headwinds also mostly matches our forecast. We don’t anticipate a material shift to our fair value estimate as we make a few adjustments to our model, but the potential approval of oral multiple sclerosis medication Mavenclad in the U.S. ...
- Michael Waterhouse
Performance in Merck's Life Sciences and Healthcare Divisions Should O...
We think there's plenty to like about the life science and diagnostics industry, including attractive growth opportunities and several competitive advantages that lead to economic moats. The industry tends to have a predictable and attractive growth outlook, especially in areas such as bioprocessing, analytical instrumentation, and genomics, in addition to being somewhat insulated from broader macroeconomic cycles. Nearly every company under our life science and diagnostic manufacturer coverage ...
- Michael Waterhouse
Life Science and Diagnostics Industry Offers Attractive Growth and Moa...
We think there's plenty to like about the life science and diagnostics industry, including attractive growth opportunities and several competitive advantages that lead to economic moats. The industry tends to have a predictable and attractive growth outlook, especially in areas such as bioprocessing, analytical instrumentation, and genomics, in addition to being somewhat insulated from broader macroeconomic cycles. Nearly every company under our life science and diagnostic manufacturer coverage ...
- Michael Waterhouse
Merck Posts Better-Than-Expected 3Q, but Long-Term Outlook Mostly Unch...
While negative currency effects in Latin America weighed on Merck KGaA’s third-quarter results, the company witnessed strong underlying growth, especially in its healthcare and life sciences segments. Consolidated organic growth reached 8.8% while currency, investments in operations, and the pricing pressure in the liquid crystals business led to an EBITDA margin of 25.7%, down about 340 basis points from last year. Management raised its revenue outlook for the year but kept its bottom-line gu...
- Michael Waterhouse
Merck’s 2Q Results on Track as Firm Navigates Currency and Liquid Cr...
We don’t anticipate a change to our fair value estimate for Merck KGaA following the company’s second-quarter results. As we mostly expected, currency headwinds and ongoing pricing pressure in the liquid crystals portion of the performance materials division led to a 13.7% decline in consolidated adjusted EBITDA. Overall, however, our forecast for EUR 14.3 billion in revenue and $3.85 billion in EBITDA for the year falls near the midpoint of management’s outlook. While we remain concerned ...
- Michael Waterhouse
Merck's life sciences division should help offset pharmaceutical and l...
We plan to make a few adjustments to our model, but we don’t anticipate a material change to our fair value estimate for Merck KGaA even though our current forecast is at the high end of management’s updated outlook accounting for the recent consumer health segment sale to Procter & Gamble. We don’t envision any change to our narrow moat rating for the company. Negative currency effects remain a large headwind for the company, subtracting 7.9% off the top line, but underlying performance r...
- Michael Waterhouse
Merck's Life Sciences Remains Source of Stability Among Healthcare and...
We plan to make a few adjustments to our model, but we don’t anticipate a material change to our fair value estimate for Merck KGaA even though our current forecast is at the high end of management’s updated outlook accounting for the recent consumer health segment sale to Procter & Gamble. We don’t envision any change to our narrow moat rating for the company. Negative currency effects remain a large headwind for the company, subtracting 7.9% off the top line, but underlying performance r...
- Michael Waterhouse
Merck's life sciences division should help offset pharmaceutical and l...
Merck KGaA’s year-end results fell mostly in line with our expectations, which were already at the low end of management’s outlook. Based in large part on negative currency effects, management’s guidance of an approximate 4% to 6% decline in EBITDA for 2018 falls below our forecast. We anticipate a slight reduction in our fair value estimate as we adjust our projections, especially for the performance materials division. We also plan to lower our Bavencio forecast following Merck’s recen...
- Michael Waterhouse
Merck KGaA’s 3Q Meets Our Expectations as Currency Weighs on Results
We don’t anticipate any change to our fair value estimate as Merck KGaA’s third-quarter results came in line with our expectations. Sales remained roughly unchanged from last year, but sales climbed 4.2% when excluding negative currency effects. Currency headwinds should persist placing year-end performance near the low point of management’s outlook, which remains unchanged. Regardless, Merck’s underlying performance remains consistent with previous quarters this year, especially higher ...
- Michael Waterhouse
Merck's life sciences division should help offset its pharmaceutical a...
We plan to leave our fair value estimate for Merck unchanged after the company’s second-quarter results of 2.3% growth and modest margin erosion, due in part to headwinds in the liquid crystal market from Chinese competition. We plan to slightly reduce our near-term profitability assumptions as we have become increasingly concerned about the trajectory of the liquid-crystals business combined with higher operating costs in the healthcare segment as the firm launches recently approved Bavencio ...
- Michael Waterhouse
Merck KGaA Posts Stable 2Q, but Liquid-Crystals Business Concerns Pers...
We plan to leave our fair value estimate for Merck unchanged after the company’s second-quarter results of 2.3% growth and modest margin erosion, due in part to headwinds in the liquid crystal market from Chinese competition. We plan to slightly reduce our near-term profitability assumptions as we have become increasingly concerned about the trajectory of the liquid-crystals business combined with higher operating costs in the healthcare segment as the firm launches recently approved Bavencio ...
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