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MCK vs MRK

MCK
McKesson Corporation
BULLISH
Price
$842.09
Market Cap
$104.45B
Sector
Healthcare
AI Confidence
88%
MRK
Merck & Co., Inc.
NEUTRAL
Price
$121.25
Market Cap
$299.79B
Sector
Healthcare
AI Confidence
90%

Valuation

P/E Ratio
MCK
26.32
MRK
16.66
Forward P/E
MCK
22.88
MRK
12.42
P/B Ratio
MCK
-60.05
MRK
5.7
P/S Ratio
MCK
0.27
MRK
4.61
EV/EBITDA
MCK
17.07
MRK
11.46

Profitability

Gross Margin
MCK
3.44%
MRK
77.21%
Operating Margin
MCK
1.37%
MRK
32.77%
Profit Margin
MCK
1.04%
MRK
28.08%
ROE
MCK
--
MRK
36.88%
ROA
MCK
4.78%
MRK
12.04%

Growth

Revenue Growth
MCK
10.1%
MRK
5.0%
Earnings Growth
MCK
377.0%
MRK
-19.3%

Financial Health

Debt/Equity
MCK
--
MRK
0.96
Current Ratio
MCK
0.88
MRK
1.54
Quick Ratio
MCK
0.47
MRK
0.96

Dividends

Dividend Yield
MCK
0.39%
MRK
2.83%
Payout Ratio
MCK
9.22%
MRK
45.05%

AI Verdict

MCK BULLISH

McKesson Corporation (MCK) presents a compelling investment case supported by robust earnings acceleration, consistent top-line growth, and strong analyst conviction, despite operating in a low-margin, capital-intensive distribution model. The stock has delivered exceptional long-term returns with a 373% five-year gain, underpinned by disciplined execution and favorable healthcare logistics tailwinds. While valuation appears stretched on P/E and the balance sheet lacks transparency, MCK trades at a significant discount to peers on price-to-sales and exhibits superior earnings momentum, with YoY EPS growth nearing 40%. Notably, insider selling raises caution, but the broader fundamental trajectory and sector positioning support continued outperformance.

Strengths
Exceptional earnings growth: 377% YoY and 360.6% QoQ earnings growth reflect strong operational leverage and cost discipline.
Consistent earnings beat record: 22 out of 25 quarters beat estimates, with 10+ consecutive beats and an average surprise of +8.9% over the last five quarters.
Attractive valuation relative to sector: P/S of 0.27 is dramatically below sector average of 1.0+ and peer group, suggesting significant undervaluation on revenue basis.
Risks
Extremely low profitability: 1.04% net margin and 1.37% operating margin reflect razor-thin returns typical of distribution, limiting downside protection.
Severe financial opacity: Missing key metrics (EV, debt, cash, shares outstanding) raises transparency concerns and impedes accurate credit and valuation analysis.
Negative Price/Book ratio (-60.05): Suggests accumulated losses or negative equity, a serious red flag for financial stability and accounting integrity.
MRK NEUTRAL

MRK shows neutral fundamentals based on deterministic rules. Financial strength is weak (F-Score 3/9). Mixed signals with both opportunities and risks present.

Strengths
Strong profitability (28.1% margin)
Strong ROE of 36.9%
Risks
Premium vs Graham Number ($59.01)
Weak financial trend (Piotroski F-Score: 3/9)

Compare Another Pair

MCK vs MRK: Head-to-Head Comparison

This page compares McKesson Corporation (MCK) and Merck & Co., Inc. (MRK) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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