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MERC

Mercer International NasdaqGS:MERC Stock Report

Last Price

US$12.97

Market Cap

US$857.1m

7D

-2.8%

1Y

1.2%

Updated

26 Jun, 2022

Data

Company Financials +
MERC fundamental analysis
Snowflake Score
Valuation4/6
Future Growth0/6
Past Performance3/6
Financial Health3/6
Dividends3/6

MERC Stock Overview

Mercer International Inc., together with its subsidiaries, manufactures and sells northern bleached softwood kraft (NBSK) pulp in Europe, the United States, Asia, and internationally.

Mercer International Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Mercer International
Historical stock prices
Current Share PriceUS$12.97
52 Week HighUS$17.17
52 Week LowUS$9.51
Beta1.44
1 Month Change-13.13%
3 Month Change-9.24%
1 Year Change1.17%
3 Year Change-16.16%
5 Year Change12.78%
Change since IPO49.79%

Recent News & Updates

Jun 23
These 4 Measures Indicate That Mercer International (NASDAQ:MERC) Is Using Debt Extensively

These 4 Measures Indicate That Mercer International (NASDAQ:MERC) Is Using Debt Extensively

David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the...

Shareholder Returns

MERCUS ForestryUS Market
7D-2.8%-5.8%6.6%
1Y1.2%-12.4%-18.4%

Return vs Industry: MERC exceeded the US Forestry industry which returned -12.4% over the past year.

Return vs Market: MERC exceeded the US Market which returned -18.4% over the past year.

Price Volatility

Is MERC's price volatile compared to industry and market?
MERC volatility
MERC Average Weekly Movement6.2%
Forestry Industry Average Movement8.2%
Market Average Movement8.1%
10% most volatile stocks in US Market16.6%
10% least volatile stocks in US Market3.2%

Stable Share Price: MERC is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: MERC's weekly volatility (6%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19682,415Juan Buenohttps://www.mercerint.com

Mercer International Inc., together with its subsidiaries, manufactures and sells northern bleached softwood kraft (NBSK) pulp in Europe, the United States, Asia, and internationally. The company operates through two segments, Pulp and Wood Products. It also generates and sells green energy produced from biomass cogeneration power plant to third party utilities.

Mercer International Fundamentals Summary

How do Mercer International's earnings and revenue compare to its market cap?
MERC fundamental statistics
Market CapUS$857.10m
Earnings (TTM)US$253.95m
Revenue (TTM)US$1.98b

3.4x

P/E Ratio

0.4x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
MERC income statement (TTM)
RevenueUS$1.98b
Cost of RevenueUS$1.35b
Gross ProfitUS$631.76m
Other ExpensesUS$377.80m
EarningsUS$253.95m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Jul 28, 2022

Earnings per share (EPS)3.84
Gross Margin31.85%
Net Profit Margin12.80%
Debt/Equity Ratio158.0%

How did MERC perform over the long term?

See historical performance and comparison

Dividends

2.3%

Current Dividend Yield

7%

Payout Ratio

Does MERC pay a reliable dividends?

See MERC dividend history and benchmarks
When do you need to buy MERC by to receive an upcoming dividend?
Mercer International dividend dates
Ex Dividend DateJun 28 2022
Dividend Pay DateJul 07 2022
Days until Ex dividend0 days
Days until Dividend pay date9 days

Does MERC pay a reliable dividends?

See MERC dividend history and benchmarks
We’ve recently updated our valuation analysis.

Valuation

Is MERC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for MERC?

Other financial metrics that can be useful for relative valuation.

MERC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue0.9x
Enterprise Value/EBITDA3.1x
PEG Ratio-0.08x

Price to Earnings Ratio vs Peers

How does MERC's PE Ratio compare to its peers?

MERC PE Ratio vs Peers
The above table shows the PE ratio for MERC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average4.7x
RFP Resolute Forest Products
2.2x-35.4%US$929.2m
SLVM Sylvamo
4.8xn/aUS$1.4b
ITP IT Tech Packaging
6.1xn/aUS$16.8m
NEXA Nexa Resources
5.7x4.1%US$886.0m
MERC Mercer International
3.4x-43.5%US$857.1m

Price-To-Earnings vs Peers: MERC is good value based on its Price-To-Earnings Ratio (3.4x) compared to the peer average (4.7x).


Price to Earnings Ratio vs Industry

How does MERC's PE Ratio compare vs other companies in the Global Forestry Industry?

Price-To-Earnings vs Industry: MERC is expensive based on its Price-To-Earnings Ratio (3.4x) compared to the US Forestry industry average (3.4x)


Price to Earnings Ratio vs Fair Ratio

What is MERC's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

MERC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio3.4x
Fair PE Ratio4.2x

Price-To-Earnings vs Fair Ratio: MERC is good value based on its Price-To-Earnings Ratio (3.4x) compared to the estimated Fair Price-To-Earnings Ratio (4.2x).


Share Price vs Fair Value

What is the Fair Price of MERC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: MERC ($12.97) is trading below our estimate of fair value ($16.69)

Significantly Below Fair Value: MERC is trading below fair value by more than 20%.


Price to Earnings Growth Ratio

PEG Ratio: MERC's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


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Future Growth

How is Mercer International forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


-43.5%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MERC's earnings are forecast to decline over the next 3 years (-43.5% per year).

Earnings vs Market: MERC's earnings are forecast to decline over the next 3 years (-43.5% per year).

High Growth Earnings: MERC's earnings are forecast to decline over the next 3 years.

Revenue vs Market: MERC's revenue is expected to decline over the next 3 years (-6.7% per year).

High Growth Revenue: MERC's revenue is forecast to decline over the next 3 years (-6.7% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MERC's Return on Equity is forecast to be low in 3 years time (16.3%).


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Past Performance

How has Mercer International performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


0.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: MERC has high quality earnings.

Growing Profit Margin: MERC became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: MERC's earnings have grown by 0.6% per year over the past 5 years.

Accelerating Growth: MERC has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: MERC has become profitable in the last year, making it difficult to compare its past year earnings growth to the Forestry industry (76.7%).


Return on Equity

High ROE: Whilst MERC's Return on Equity (33.05%) is high, this metric is skewed due to their high level of debt.


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Financial Health

How is Mercer International's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: MERC's short term assets ($1.2B) exceed its short term liabilities ($281.2M).

Long Term Liabilities: MERC's short term assets ($1.2B) do not cover its long term liabilities ($1.4B).


Debt to Equity History and Analysis

Debt Level: MERC's net debt to equity ratio (104.5%) is considered high.

Reducing Debt: MERC's debt to equity ratio has reduced from 163.2% to 158% over the past 5 years.

Debt Coverage: MERC's debt is not well covered by operating cash flow (18.2%).

Interest Coverage: MERC's interest payments on its debt are well covered by EBIT (6.1x coverage).


Balance Sheet


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Dividend

What is Mercer International current dividend yield, its reliability and sustainability?

Dividend Score

2/6

Dividend Score 2/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage


2.31%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: MERC's dividend (2.31%) is higher than the bottom 25% of dividend payers in the US market (1.57%).

High Dividend: MERC's dividend (2.31%) is low compared to the top 25% of dividend payers in the US market (4.24%).


Stability and Growth of Payments

Stable Dividend: MERC has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: MERC has only been paying a dividend for 7 years, and since then payments have fallen.


Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (7%), MERC's dividend payments are thoroughly covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (37.8%), MERC's dividend payments are well covered by cash flows.


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Management

How experienced are the management team and are they aligned to shareholders interests?

3.3yrs

Average management tenure


CEO

Juan Bueno (53 yo)

0.083

Tenure

Mr. Juan Carlos Bueno, M.Sc. (Industrial Eng.), joined Mercer International Inc. as President, Chief Executive Officer, and Director in May 01, 2022. He has served as an Executive Vice President of Biomate...


Leadership Team

Experienced Management: MERC's management team is considered experienced (3.3 years average tenure).


Board Members

Experienced Board: MERC's board of directors are considered experienced (4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Mercer International Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: Mercer International Inc.
  • Ticker: MERC
  • Exchange: NasdaqGS
  • Founded: 1968
  • Industry: Paper Products
  • Sector: Materials
  • Implied Market Cap: US$857.100m
  • Shares outstanding: 66.08m
  • Website: https://www.mercerint.com

Number of Employees


Location

  • Mercer International Inc.
  • 700 West Pender Street
  • Suite 1120
  • Vancouver
  • British Columbia
  • V6C 1G8
  • Canada

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/06/26 00:00
End of Day Share Price2022/06/24 00:00
Earnings2022/03/31
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.