Merck KGaA Operating Margin vs. Return On Equity
| MKKGY Stock | USD 29.90 0.04 0.13% |
For Merck KGaA profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Merck KGaA to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Merck KGaA ADR utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Merck KGaA's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Merck KGaA ADR over time as well as its relative position and ranking within its peers.
Merck |
Merck KGaA ADR Return On Equity vs. Operating Margin Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Merck KGaA's current stock value. Our valuation model uses many indicators to compare Merck KGaA value to that of its competitors to determine the firm's financial worth. Merck KGaA ADR is considered to be number one stock in operating margin category among its peers. It also is considered to be number one stock in return on equity category among its peers reporting about 0.62 of Return On Equity per Operating Margin. The ratio of Operating Margin to Return On Equity for Merck KGaA ADR is roughly 1.60 . Comparative valuation analysis is a catch-all model that can be used if you cannot value Merck KGaA by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Merck KGaA's Pink Sheet. Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued.Merck Return On Equity vs. Operating Margin
Operating Margin shows how much operating income a company makes on each dollar of sales. It is one of the profitability indicators which helps analysts to understand whether the firm is successful or not making money from everyday operations.
Merck KGaA |
| = | 0.23 % |
A good Operating Margin is required for a company to be able to pay for its fixed costs or payout its debt, which implies that the higher the margin, the better. This ratio is most effective in evaluating the earning potential of a company over time when comparing it against a firm's competitors.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Merck KGaA |
| = | 0.14 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Merck Return On Equity Comparison
Merck KGaA is currently under evaluation in return on equity category among its peers.
Merck KGaA Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Merck KGaA, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Merck KGaA will eventually generate negative long term returns. The profitability progress is the general direction of Merck KGaA's change in net profit over the period of time. It can combine multiple indicators of Merck KGaA, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
MERCK Kommanditgesellschaft auf Aktien operates in the healthcare, life science, and electronics sectors worldwide. MERCK Kommanditgesellschaft auf Aktien is a subsidiary of E. Merck Kgaa operates under Drug ManufacturersSpecialty Generic classification in the United States and is traded on OTC Exchange. It employs 62770 people.
Merck Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Merck KGaA. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Merck KGaA position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Merck KGaA's important profitability drivers and their relationship over time.
Use Merck KGaA in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Merck KGaA position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Merck KGaA will appreciate offsetting losses from the drop in the long position's value.Merck KGaA Pair Trading
Merck KGaA ADR Pair Trading Analysis
The ability to find closely correlated positions to Merck KGaA could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Merck KGaA when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Merck KGaA - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Merck KGaA ADR to buy it.
The correlation of Merck KGaA is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Merck KGaA moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Merck KGaA ADR moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Merck KGaA can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Merck KGaA position
In addition to having Merck KGaA in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
Run Pharmaceutical Products Thematic Idea Now
Pharmaceutical Products
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Pharmaceutical Products theme has 61 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Pharmaceutical Products Theme or any other thematic opportunities.
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Additional Tools for Merck Pink Sheet Analysis
When running Merck KGaA's price analysis, check to measure Merck KGaA's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Merck KGaA is operating at the current time. Most of Merck KGaA's value examination focuses on studying past and present price action to predict the probability of Merck KGaA's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Merck KGaA's price. Additionally, you may evaluate how the addition of Merck KGaA to your portfolios can decrease your overall portfolio volatility.