Mercer International (NASDAQ:MERC) Price Target Lowered to $1.25 at Royal Bank Of Canada

Key Points

• Royal Bank of Canada cut its price target for Mercer International from $2.00 to $1.25 and maintained a "sector perform" rating, implying roughly an 18.48% upside from the current share price.
• Mercer traded around $1.06 (near its 52-week low of $1.00) after reporting a quarterly loss (EPS -$1.39 vs. -$0.88 expected) and showing negative return on equity and net margins, highlighting weak profitability.
• The stock carries a consensus "Reduce" rating with a consensus target of $2.80 amid several recent downgrades, while institutional investors hold about 85.8% of the shares.

Mercer International (NASDAQ:MERC - Get Free Report) TSE: MRI.U had its price target decreased by equities researchers at Royal Bank Of Canada from $2.00 to $1.25 in a research note issued to investors on Thursday,Benzinga reports. The brokerage presently has a "sector perform" rating on the basic materials company's stock. Royal Bank Of Canada's target price would suggest a potential upside of 18.48% from the company's current price.

A number of other equities analysts also recently commented on MERC. TD Securities cut shares of Mercer International from a "hold" rating to a "strong sell" rating in a research report on Wednesday, February 18th. TD Cowen cut shares of Mercer International from a "hold" rating to a "sell" rating and boosted their target price for the stock from $2.00 to $2.25 in a research report on Wednesday, January 21st. Finally, Weiss Ratings reissued a "sell (e+)" rating on shares of Mercer International in a research report on Friday, March 27th. Three research analysts have rated the stock with a Hold rating and three have given a Sell rating to the company's stock. According to MarketBeat.com, the stock has a consensus rating of "Reduce" and a consensus target price of $2.80.

Mercer International Price Performance

NASDAQ:MERC traded down $0.04 during mid-day trading on Thursday, hitting $1.06. 74,312 shares of the company's stock traded hands, compared to its average volume of 598,088. Mercer International has a 1 year low of $1.00 and a 1 year high of $5.15. The company has a market cap of $70.66 million, a PE ratio of -0.14 and a beta of 0.77. The firm's 50 day simple moving average is $1.57 and its 200 day simple moving average is $1.97. The company has a debt-to-equity ratio of 23.58, a quick ratio of 1.79 and a current ratio of 3.05.

Mercer International (NASDAQ:MERC - Get Free Report) TSE: MRI.U last released its earnings results on Thursday, February 12th. The basic materials company reported ($1.39) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.88) by ($0.51). Mercer International had a negative return on equity of 81.16% and a negative net margin of 26.65%.The company had revenue of $449.50 million during the quarter, compared to analyst estimates of $459.84 million. Sell-side analysts expect that Mercer International will post -0.29 EPS for the current year.

Institutional Trading of Mercer International

A number of hedge funds have recently bought and sold shares of the company. Geode Capital Management LLC lifted its stake in Mercer International by 2.7% during the fourth quarter. Geode Capital Management LLC now owns 561,001 shares of the basic materials company's stock valued at $1,111,000 after buying an additional 14,603 shares in the last quarter. Millennium Management LLC lifted its stake in Mercer International by 16.1% during the third quarter. Millennium Management LLC now owns 994,974 shares of the basic materials company's stock valued at $2,866,000 after buying an additional 137,906 shares in the last quarter. Iat Reinsurance Co. LTD. increased its holdings in shares of Mercer International by 1.3% in the 3rd quarter. Iat Reinsurance Co. LTD. now owns 16,700,000 shares of the basic materials company's stock valued at $48,096,000 after purchasing an additional 220,000 shares during the period. Gabelli Funds LLC acquired a new position in shares of Mercer International in the 2nd quarter valued at about $1,804,000. Finally, Gamco Investors INC. ET AL acquired a new position in shares of Mercer International in the 2nd quarter valued at about $244,000. 85.79% of the stock is owned by hedge funds and other institutional investors.

About Mercer International

Mercer International Inc is a publicly traded pulp producer headquartered in Vancouver, British Columbia. Listed on the NASDAQ under the symbol MERC, the company specializes in the manufacture of Northern Bleached Softwood Kraft (NBSK) pulp and dissolving pulp for use in tissue, specialty paper and textile applications.

Mercer's core business activities include the operation of integrated pulp mills in North America and Europe. Its production portfolio encompasses NBSK pulp, renowned for its strength and versatility, and dissolving pulp, which serves as a key raw material in the manufacture of viscose, cellulose acetate and other specialty products.

The company's facilities are located in British Columbia and the U.S.

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