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Merck Interest Coverage

: 21.11 (As of Jun. 2022)
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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Merck's Operating Income for the three months ended in Jun. 2022 was $5,067 Mil. Merck's Interest Expense for the three months ended in Jun. 2022 was $-240 Mil. Merck's interest coverage for the quarter that ended in Jun. 2022 was 21.11. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Merck's Interest Coverage or its related term are showing as below:

MRK' s Interest Coverage Range Over the Past 10 Years
Min: 6.68   Med: 9.35   Max: 21.8
Current: 21.8


MRK's Interest Coverage is ranked better than
50.62% of 650 companies
in the Drug Manufacturers industry
Industry Median: 21.26 vs MRK: 21.80

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.


Merck Interest Coverage Historical Data

The historical data trend for Merck's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Merck Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Interest Coverage
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 9.01 11.57 8.88 6.68 16.38

Merck Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Interest Coverage Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 8.40 25.12 17.94 23.14 21.11

Competitive Comparison

For the Drug Manufacturers - General subindustry, Merck's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Merck Interest Coverage Distribution

For the Drug Manufacturers industry and Healthcare sector, Merck's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Merck's Interest Coverage falls into.



Merck Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage=-1* Operating Income /Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt.


Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Merck's Interest Coverage for the fiscal year that ended in Dec. 2021 is calculated as

Here, for the fiscal year that ended in Dec. 2021, Merck's Interest Expense was $-806 Mil. Its Operating Income was $13,199 Mil. And its Long-Term Debt & Capital Lease Obligation was $30,690 Mil.

Interest Coverage=-1* Operating Income (A: Dec. 2021 )/Interest Expense (A: Dec. 2021 )
=-1*13199/-806
=16.38

Merck's Interest Coverage for the quarter that ended in Jun. 2022 is calculated as

Here, for the three months ended in Jun. 2022, Merck's Interest Expense was $-240 Mil. Its Operating Income was $5,067 Mil. And its Long-Term Debt & Capital Lease Obligation was $28,684 Mil.

Interest Coverage=-1* Operating Income (Q: Jun. 2022 )/Interest Expense (Q: Jun. 2022 )
=-1*5067/-240
=21.11

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

The higher the ratio, the stronger the company's Financial Strength is.


Merck  (NYSE:MRK) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .


Merck Interest Coverage Related Terms

Thank you for viewing the detailed overview of Merck's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.


Merck Business Description

Merck logo
Address
2000 Galloping Hill Road, Kenilworth, NJ, USA, 07033
Merck makes pharmaceutical products to treat several conditions in a number of therapeutic areas, including cardiometabolic disease, cancer, and infections. Within cancer, the firm's immuno-oncology platform is growing as a major contributor to overall sales. The company also has a substantial vaccine business, with treatments to prevent hepatitis B and pediatric diseases as well as HPV and shingles. Additionally, Merck sells animal health-related drugs. From a geographical perspective, close to half of the firm's sales are generated in the United States.
Executives
Baker Douglas M Jr director 370 WBASHA ST NORTH ST PAUL MN 55102
Oosthuizen Johannes Jacobus officer: SVP, U.S. Market 2000 GALLOPING HILL RD KENILWORTH NJ 07033
Garay Arpa officer: SVP Human Health Global Mktg. 2000 GALLOPING HILL RD KENILWORTH NJ 07033
Downing Cristal N officer: Chief Comm. & Public Afrs Ofcr 2000 GALLOPING HILL RD KENILWORTH NJ 07033
Klobuchar Michael A officer: EVP - Chief Strategy Officer 2000 GALLOPING HILL RD KENILWORTH NJ 07033
Lecointe-cephas Lisa officer: SVP Chief Ethics & Com Officer 2000 GALLOPING HILL RD KENILWORTH NJ 07033
Litchfield Caroline officer: EVP & CFO 2000 GALLOPING HILL RD KENILWORTH NJ 07033
Mayo Stephen director 2000 GALLOPING HILL RD KENILWORTH NJ 07033
Li Dean Y officer: Executive VP & President, MRL 2000 GALLOPING HILL ROAD KENILWORTH NJ 07033
Williams David Michael officer: EVP,Chief Info&Digital Officer MERCK & CO., INC. 2000 GALLOPING HILL ROAD KENILWORTH NJ 07033
Lavizzo-mourey Risa J director GENERAL ELECTRIC COMPANY 5 NECCO STREET BOSTON MA 02210
Seidman Christine E director MERCK & CO., INC. 2000 GALLOPING HILL ROAD KENILWORTH NJ 07033
Warden Kathy J director 2980 FAIRVIEW PARK DRIVE FALLS CHURCH VA 22042
Craig Pamela director C/O ACCENTURE 161 N CLARK STREET CHICAGO IL 60601
Brun Leslie A director 435 DEVON PARK DRIVE 700 BUILDING WAYNE PA 19087

Merck Headlines

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