Stock Analysis on Net
Stock Analysis on Net

Merck & Co. Inc. (NYSE:MRK)

DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
Quarterly Data

Beginner level


Two-Component Disaggregation of ROE

Merck & Co. Inc., decomposition of ROE (quarterly data)

Microsoft Excel LibreOffice Calc
ROE = ROA × Financial Leverage
Jun 30, 2020 37.91% = 11.56% × 3.28
Mar 31, 2020 38.72% = 11.95% × 3.24
Dec 31, 2019 37.99% = 11.66% × 3.26
Sep 30, 2019 34.70% = 11.18% × 3.10
Jun 30, 2019 33.88% = 11.15% × 3.04
Mar 31, 2019 30.50% = 10.20% × 2.99
Dec 31, 2018 23.30% = 7.53% × 3.09
Sep 30, 2018 10.32% = 3.93% × 2.63
Jun 30, 2018 4.12% = 1.58% × 2.61
Mar 31, 2018 4.69% = 1.84% × 2.56
Dec 31, 2017 6.97% = 2.72% × 2.56
Sep 30, 2017 7.44% = 3.11% × 2.40
Jun 30, 2017 12.89% = 5.48% × 2.35
Mar 31, 2017 10.91% = 4.50% × 2.42
Dec 31, 2016 9.78% = 4.11% × 2.38
Sep 30, 2016 12.55% = 5.58% × 2.25
Jun 30, 2016 11.84% = 5.32% × 2.23
Mar 31, 2016 10.53% = 4.67% × 2.25
Dec 31, 2015 9.94% = 4.36% × 2.28
Sep 30, 2015 = × 2.22
Jun 30, 2015 = × 2.21
Mar 31, 2015 = × 2.27

Based on: 10-Q (filing date: 2020-08-05), 10-Q (filing date: 2020-05-06), 10-K (filing date: 2020-02-26), 10-Q (filing date: 2019-11-05), 10-Q (filing date: 2019-08-06), 10-Q (filing date: 2019-05-08), 10-K (filing date: 2019-02-27), 10-Q (filing date: 2018-11-06), 10-Q (filing date: 2018-08-07), 10-Q (filing date: 2018-05-08), 10-K (filing date: 2018-02-27), 10-Q (filing date: 2017-11-07), 10-Q (filing date: 2017-08-08), 10-Q (filing date: 2017-05-09), 10-K (filing date: 2017-02-28), 10-Q (filing date: 2016-11-07), 10-Q (filing date: 2016-08-08), 10-Q (filing date: 2016-05-09), 10-K (filing date: 2016-02-26), 10-Q (filing date: 2015-11-05), 10-Q (filing date: 2015-08-06), 10-Q (filing date: 2015-05-07).

The primary reason for the decrease in return on equity ratio (ROE) over Q2 2020 is the decrease in profitability measured by return on assets ratio (ROA).


Three-Component Disaggregation of ROE

Merck & Co. Inc., decomposition of ROE (quarterly data)

Microsoft Excel LibreOffice Calc
ROE = Net Profit Margin × Asset Turnover × Financial Leverage
Jun 30, 2020 37.91% = 22.20% × 0.52 × 3.28
Mar 31, 2020 38.72% = 21.10% × 0.57 × 3.24
Dec 31, 2019 37.99% = 21.01% × 0.55 × 3.26
Sep 30, 2019 34.70% = 20.26% × 0.55 × 3.10
Jun 30, 2019 33.88% = 21.10% × 0.53 × 3.04
Mar 31, 2019 30.50% = 19.50% × 0.52 × 2.99
Dec 31, 2018 23.30% = 14.71% × 0.51 × 3.09
Sep 30, 2018 10.32% = 8.02% × 0.49 × 2.63
Jun 30, 2018 4.12% = 3.25% × 0.49 × 2.61
Mar 31, 2018 4.69% = 3.88% × 0.47 × 2.56
Dec 31, 2017 6.97% = 5.97% × 0.46 × 2.56
Sep 30, 2017 7.44% = 7.15% × 0.43 × 2.40
Jun 30, 2017 12.89% = 12.71% × 0.43 × 2.35
Mar 31, 2017 10.91% = 10.88% × 0.41 × 2.42
Dec 31, 2016 9.78% = 9.85% × 0.42 × 2.38
Sep 30, 2016 12.55% = 13.76% × 0.41 × 2.25
Jun 30, 2016 11.84% = 13.01% × 0.41 × 2.23
Mar 31, 2016 10.53% = 11.72% × 0.40 × 2.25
Dec 31, 2015 9.94% = 11.25% × 0.39 × 2.28
Sep 30, 2015 = × × 2.22
Jun 30, 2015 = × × 2.21
Mar 31, 2015 = × × 2.27

Based on: 10-Q (filing date: 2020-08-05), 10-Q (filing date: 2020-05-06), 10-K (filing date: 2020-02-26), 10-Q (filing date: 2019-11-05), 10-Q (filing date: 2019-08-06), 10-Q (filing date: 2019-05-08), 10-K (filing date: 2019-02-27), 10-Q (filing date: 2018-11-06), 10-Q (filing date: 2018-08-07), 10-Q (filing date: 2018-05-08), 10-K (filing date: 2018-02-27), 10-Q (filing date: 2017-11-07), 10-Q (filing date: 2017-08-08), 10-Q (filing date: 2017-05-09), 10-K (filing date: 2017-02-28), 10-Q (filing date: 2016-11-07), 10-Q (filing date: 2016-08-08), 10-Q (filing date: 2016-05-09), 10-K (filing date: 2016-02-26), 10-Q (filing date: 2015-11-05), 10-Q (filing date: 2015-08-06), 10-Q (filing date: 2015-05-07).

The primary reason for the decrease in return on equity ratio (ROE) over Q2 2020 is the decrease in efficiency measured by asset turnover ratio.


Two-Component Disaggregation of ROA

Merck & Co. Inc., decomposition of ROA (quarterly data)

Microsoft Excel LibreOffice Calc
ROA = Net Profit Margin × Asset Turnover
Jun 30, 2020 11.56% = 22.20% × 0.52
Mar 31, 2020 11.95% = 21.10% × 0.57
Dec 31, 2019 11.66% = 21.01% × 0.55
Sep 30, 2019 11.18% = 20.26% × 0.55
Jun 30, 2019 11.15% = 21.10% × 0.53
Mar 31, 2019 10.20% = 19.50% × 0.52
Dec 31, 2018 7.53% = 14.71% × 0.51
Sep 30, 2018 3.93% = 8.02% × 0.49
Jun 30, 2018 1.58% = 3.25% × 0.49
Mar 31, 2018 1.84% = 3.88% × 0.47
Dec 31, 2017 2.72% = 5.97% × 0.46
Sep 30, 2017 3.11% = 7.15% × 0.43
Jun 30, 2017 5.48% = 12.71% × 0.43
Mar 31, 2017 4.50% = 10.88% × 0.41
Dec 31, 2016 4.11% = 9.85% × 0.42
Sep 30, 2016 5.58% = 13.76% × 0.41
Jun 30, 2016 5.32% = 13.01% × 0.41
Mar 31, 2016 4.67% = 11.72% × 0.40
Dec 31, 2015 4.36% = 11.25% × 0.39
Sep 30, 2015 = ×
Jun 30, 2015 = ×
Mar 31, 2015 = ×

Based on: 10-Q (filing date: 2020-08-05), 10-Q (filing date: 2020-05-06), 10-K (filing date: 2020-02-26), 10-Q (filing date: 2019-11-05), 10-Q (filing date: 2019-08-06), 10-Q (filing date: 2019-05-08), 10-K (filing date: 2019-02-27), 10-Q (filing date: 2018-11-06), 10-Q (filing date: 2018-08-07), 10-Q (filing date: 2018-05-08), 10-K (filing date: 2018-02-27), 10-Q (filing date: 2017-11-07), 10-Q (filing date: 2017-08-08), 10-Q (filing date: 2017-05-09), 10-K (filing date: 2017-02-28), 10-Q (filing date: 2016-11-07), 10-Q (filing date: 2016-08-08), 10-Q (filing date: 2016-05-09), 10-K (filing date: 2016-02-26), 10-Q (filing date: 2015-11-05), 10-Q (filing date: 2015-08-06), 10-Q (filing date: 2015-05-07).

The primary reason for the decrease in return on assets ratio (ROA) over Q2 2020 is the decrease in asset turnover ratio.