1-Star Price
INVESTOR
5-Star Price
INVESTOR
Economic Moat
INVESTOR
Capital Allocation
INVESTOR
Merck KGaA has made a series of acquisitions and divestitures in the past decade or so to position the group for solid long-term growth in three key segments: life sciences, performance materials, and healthcare. However, after robust results in 2020 and 2021 due to COVID-19-related benefits particularly in its life sciences business, we think the company's intermediate-term growth may soften toward more historic norms.
Merck KGaA operates in three main segments: life sciences, performance materials, and healthcare. The life sciences segment (46% of 2021 sales) provides laboratory consumables and instruments to researchers in academia and applied fields, including the biopharmaceutical industry. In the healthcare segment (36%), Merck develops, manufactures, and sells branded pharmaceuticals with significant therapeutic concentrations in oncology, multiple sclerosis, and fertility. In its electronics segment (18%), the company offers specialty materials to manufacture a variety of products, such as semiconductors, flat-screen televisions, automobiles, and cosmetics. In 1995, the E. Merck KG family publicly sold part of the company, resulting in the current 30% public ownership of the firm.
