NYSE$MRK

Merck & Co. · Q4 2019 earnings

Q4 2019 earnings · · Investor relations

Briefing

Merck reported an increase in Q4 revenue driven by oncology and animal health, and announced spin-off of Women’s Health, trusted Legacy Brands and Biosimilar products.

Merck's Q4 2019 results showed strong growth in pharmaceutical sales, driven by oncology, particularly KEYTRUDA, and animal health, boosted by the Antelliq acquisition. The company's GAAP EPS was $0.92, and non-GAAP EPS was $1.16. Merck also announced its plan to spin off its Women’s Health, trusted Legacy Brands, and Biosimilar products into a new company.

  • Fourth-quarter pharmaceutical sales increased 7% to $10.5 billion.
  • KEYTRUDA sales were $3.1 billion for the quarter.
  • Animal Health sales totaled $1.1 billion, an increase of 8%.
  • GAAP EPS was $0.92 for the fourth quarter, and non-GAAP EPS was $1.16.

Headline financials

Total Revenue

$11.9B

Previous: $11B+7.9%
EPS (adj)

$1.16

Previous: $1.04+11.5%
KEYTRUDA sales

$3.1B

No prior period
GARDASIL sales

$0.00

No prior period
Net Income

$2.35B

Previous: $1.83B+28.6%
Operating Income

$2.65B

No prior period
Gross Profit

$8.02B

Previous: $7.71B+4.0%
Cash & Equivalents

$9.68B

Previous: $7.97B+21.5%
Total Assets

$84.4B

Previous: $82.6B+2.1%
Stock-Based Comp

$111M

Previous: $87M+27.6%

Revenue & EPS history

Merck · Revenue · Quarterly

$11.9B

Q4 2019+7.9%vs Q4 2018
Beat estimate in 16 of 16 quarters(100%)
ActualEstimate

Revenue by segment

Merck · $11.6B total across 2 segments · Q4 2019

  • Pharmaceutical
    $10.5B
  • Animal Health
    $1.1B

Forward guidance

Merck anticipates full-year 2020 revenue to be between $48.8 billion and $50.3 billion. Merck expects full-year 2020 GAAP EPS to be between $4.57 and $4.72. Merck expects full-year 2020 non-GAAP EPS to be between $5.62 and $5.77.

Tailwinds

  • Full-year 2020 revenue to be between $48.8 billion and $50.3 billion.
  • Full-year 2020 GAAP EPS to be between $4.57 and $4.72.
  • Full-year 2020 non-GAAP EPS to be between $5.62 and $5.77.
  • Guidance includes a negative impact from foreign exchange of less than 1% on revenue.
  • Non-GAAP range excludes acquisition- and divestiture-related costs and costs related to restructuring programs.

Headwinds

  • Guidance includes a negative impact from foreign exchange of approximately 1.5% on non-GAAP EPS.
  • Uncertainties related to the proposed spin-off of certain businesses.
  • Risks related to general industry conditions and competition.
  • Impact of pharmaceutical industry regulation and health care legislation.
  • Global trends toward health care cost containment.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2019

Historical avgQ4 2019

-0.4%

Avg return

Earnings day

-0.4%

Avg return

5 days after

+1.4%

Avg return

30 days after

51%

37 / 73 earnings

Positive

+8.0%

Q3 2021

Best reaction

-11.7%

Q3 2017

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.0%+2.0%+6.9%
Q4 2025+2.2%+7.6%+2.4%
Q3 2025-1.0%-3.1%+21.1%
Q2 2025+1.2%+1.0%+5.2%
Q1 2025+1.5%+7.6%-1.5%
Q4 2024-9.1%-12.5%-5.8%
Q3 2024-2.8%-3.0%-3.0%
Q2 2024-11.5%-9.8%-8.1%
Q1 2024+3.3%+1.7%+2.0%
Q4 2023+4.7%+5.1%+5.1%
Q3 2023-0.8%-0.9%-1.7%
Q2 2023-0.9%-1.5%+2.2%
Q1 2023+1.8%+3.9%-2.1%
Q4 2022-3.8%-1.2%-0.1%
Q3 2022+2.4%+1.4%+9.2%
Q2 2022-2.1%-4.0%-2.2%
Q1 2022+5.1%+3.2%+10.3%
Q4 2021-4.2%-6.2%-5.1%
Q3 2021+8.0%+9.2%-2.9%
Q2 2021-1.9%-2.5%-2.6%
Q1 2021-3.4%-1.4%-1.6%
Q4 2020-2.0%-2.9%-5.4%
Q3 2020-3.4%-4.6%+1.5%
Q2 2020+4.5%+3.4%+8.4%
Q1 2020-3.8%-7.5%-5.9%
Q4 2019-3.0%-3.1%-7.0%
Q3 2019+4.9%+3.3%+6.6%
Q2 2019+0.6%+2.4%+5.1%
Q1 2019+2.5%+4.2%+3.8%
Q4 2018+3.3%+4.0%+9.7%
Q3 2018-0.2%+3.3%+5.9%
Q2 2018+1.2%+2.3%+7.9%
Q1 2018-2.7%-1.9%+1.1%
Q4 2017-5.8%-6.6%-9.2%
Q3 2017-11.7%-10.7%-12.3%
Q2 2017+0.3%-0.4%-1.2%
Q1 2017+2.0%+2.5%+4.6%
Q4 2016+3.5%+3.4%+7.2%
Q3 2016+0.2%-3.1%+1.5%
Q2 2016+0.4%-1.3%+7.6%
Q1 2016-2.2%
Q4 2015-3.6%
Q3 2015+4.1%
Q2 2015+2.7%
Q1 2015+4.5%
Q4 2014-3.0%
Q3 2014-3.1%
Q2 2014+0.2%
Q1 2014+3.3%
Q4 2013+0.5%
Q3 2013-2.1%
Q2 2013-0.3%
Q1 2013-2.7%
Q4 2012-5.6%
Q3 2012-1.4%
Q4 2011-1.0%
Q2 2012+2.6%
Q1 2012+2.0%
Q3 2011-1.5%
Q2 2011-1.6%
Q1 2011-0.7%
Q4 2010+0.8%
Q3 2010-1.8%
Q2 2010+0.8%
Q1 2009-0.1%
Q1 2010+0.1%
Q4 2009+1.4%
Q4 2007+1.4%
Q3 2009-3.5%
Q3 2008-3.5%
Q2 2008+1.7%
Q2 2009+1.7%
Q4 2008+1.7%

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