Stock fact sheet · data as of
Mercer International Inc. (MERC): fair value, margin of safety and Wheel Score
Ticker symbol MERC · Basic Materials · Paper, Lumber & Forest Products · Canada · Speculative Income
Is MERC undervalued?
At 0.2500 (close of 5 Nov 2026), MERC trades 89% below the GLS average fair value of 2.20. That average comes from 1 models run on the latest filings, and 1 of them land above the current price. Margins of safety over 30% are the exception rather than the rule across the ~7,400 stocks we value each night, so the number earns Mercer International Inc. the full Value points in the Wheel Score - and a closer look at what the market is pricing in.
The average is built from just 1 models (DDM) - the rest returned nothing because an input they need (dividends, free cash flow, book value) is zero or negative - so treat it with more caution than usual.
The nightly engine files MERC under Speculative - it is losing money or its Piotroski health score is 3 or lower - which caps its Wheel Score at 45 and keeps it out of the Sunday Scan. It also carries the Income tag (Income = a dividend yield of 4% or more).
Nine valuation models for MERC
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | - | - | Present value of the projected free cash flows, discounted at the cost of capital; no value tonight |
| Graham Number | - | - | The most a defensive investor pays for the earnings and book value per share; no value tonight |
| Graham Growth | - | - | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields; no value tonight |
| Lynch | - | - | EPS × the earnings growth rate (PEG of 1), growth capped at 25%; no value tonight |
| GLS Growth | - | - | EPS compounded ten years at the blended growth rate, discounted back at 15% a year; no value tonight |
| 10 Cap | - | - | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10%; no value tonight |
| Payback Time | - | - | Eight years of compounded free cash flow: the price at which the business pays for itself; no value tonight |
| DDM | 2.20 | +782% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | - | - | Earnings power value: current EPS capitalised at 9% with no growth; no value tonight |
| Zombie (liquidation) | -16.53 | -6711% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 1.00 | +300% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Mercer International Inc. scores only 4 of 9 on the Piotroski F-score, which fails the "Piotroski 6 or more" Wheel Trade Filter. A reading this low means several of the basic tests - positive earnings, positive operating cash flow, falling debt, no new share issuance - are not met. A GLS Moat score of 3.3/10 is a weak reading: the accounts do not show returns and margins that competitors have been unable to wear down, so the Moat part of the Wheel Score contributes little.
Returns on capital are thin or negative - ROIC -29.4%, ROE -731.5%, ROA -24.4% - with debt at 23.89 times equity and negative free cash flow. Debt of 23.89 times equity is on the high side for the sector and is worth checking against the cash flow before treating the stock as a long-term hold.
The dividend yield is high at 59.92% (payout ratio -1%). A yield this size is often the market's way of pricing a risk to the payout, so the health score and cash flow matter more than usual. Revenue comes mainly from Pulp 66%, Lumber 12%, Pallets 7% (quarter Q2 FY2026).
Institutional ownership scores 8/10, insider activity 10/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 4 / 9 | ROIC | -29.4% |
|---|---|---|---|
| GLS Moat | 3.3 / 10 | ROE | -731.5% |
| Debt / equity | 23.89 | ROA | -24.4% |
| Free-cash-flow yield | -920.2% | Payout ratio | -1% |
| Institutions | 8 / 10 | Insiders · Congress | 10 · 5 / 10 |
Wheel Score 28: Weak
With a Wheel Score of 28 Mercer International Inc. sits in the Weak band. It fails filter 2, a real business, not a gamble - speculative (a loss, or a weak Piotroski score); and filter 4, financially healthy - Piotroski 4/9 (under 6); and filter 5, can repay its debt - debt with no positive cash flow to repay it; and filter 6, no serious red flags - Red Flags score 40 (under 60); and filter 7, a premium worth selling - implied volatility 315% (over 80%); and filter 8, big enough - market cap $17M (under $1.0B); and filter 9, not a penny stock - price 0.25 (under $5); Premium (weak) is its weakest part.
Implied volatility is 315%, above the 80% ceiling of the Wheel Trade Filter on premium. The premium looks generous, but moves of that size can blow through any strike. Chain open interest is 32,720 contracts across all expiries - enough for the wheel at normal size.
Volume runs at 39.2M shares a day on a market cap of $17M, with a beta of 0.48 - a low beta, so day-to-day moves are smaller than the market's; the Stability part of the Wheel Score rates that fair.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Passes | Listed options with 1,000+ contracts of open interest and 100+ traded a day |
| 2 | A real business, not a gamble | Fails | speculative (a loss, or a weak Piotroski score) |
| 3 | Below fair value | Passes | Trading below the nine-model average fair value (margin of safety above 0) |
| 4 | Financially healthy | Fails | Piotroski 4/9 (under 6) |
| 5 | Can repay its debt | Fails | debt with no positive cash flow to repay it |
| 6 | No serious red flags | Fails | Red Flags score 40 (under 60) |
| 7 | A premium worth selling | Fails | implied volatility 315% (over 80%) |
| 8 | Big enough | Fails | market cap $17M (under $1.0B) |
| 9 | Not a penny stock | Fails | price 0.25 (under $5) |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Strong | 89% below fair value | |
| Premium | Weak | implied volatility 315% | |
| Moat | Weak | moat 3.3/10 | |
| Health | Fair | Piotroski 4/9 | |
| Red Flags | Weak | Red Flags score 40/100 | |
| Option trading | Fair | 353 contracts a day, 32,720 open interest | |
| Stability | Fair | beta 0.48, $17M company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
Mercer International Inc. reports earnings on 5 Nov 2026 (after the close) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.
Analysts downgraded MERC 2 times in the last 30 days with no upgrades; the latest action was a downgrade by CIBC on 27 Oct 2026.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Paper, Lumber & Forest Products
The 12 companies below are the closest to Mercer International Inc. by market cap within the Paper, Lumber & Forest Products industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| JCTC Jewett-Cameron Trading Company Ltd. | 2.87 | 6.64 | +57% | 31No options | $10M |
| KEWL Keweenaw Land Association, Limited | 69.00 | 0.7775 | -8774% | 15No options | $78M |
| ITP IT Tech Packaging, Inc. | 0.1260 | 5.82 | +98% | 29Weak | $2M |
| HMTC Homasote Company | 5.79 | 72.25 | +92% | 32No options | $2M |
| CLW Clearwater Paper Corporation | 14.05 | 22.61 | +38% | 43Weak | $227M |
| SLVM Sylvamo Corp | 33.60 | 71.59 | +53% | 44Weak | $1.3B |
| BCC Boise Cascade Company | 77.98 | 84.15 | +7% | 71Good | $2.7B |
| UFPI UFP Industries, Inc. | 86.31 | 73.00 | -18% | 33Weak | $4.8B |
| WFG West Fraser Timber Co. Ltd. | 69.74 | 39.04 | -79% | 26Weak | $5.3B |
| LPX Louisiana-Pacific Corporation | 78.82 | 23.54 | -235% | 32Weak | $5.5B |
| SUZ Suzano S.A. | 9.56 | 20.78 | +54% | 48Weak | $11.8B |
| IP International Paper Company | 35.65 | 22.28 | -60% | 36Weak | $18.9B |
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Start free See the Sunday ScanQuestions about MERC
Is MERC undervalued right now?
By the GLS models, yes: at 0.2500 the stock is 89% below the average fair value of 2.20 (data as of 5 Nov 2026). Whether the discount is deserved is the question to research next.
What is the Wheel Score of MERC and what does it mean?
MERC scores 28 out of 100 (Weak) - it fails Wheel Trade Filters 2, 4, 5, 6, 7, 8, 9. The Wheel Score ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned - in two parts: the 9 pass/fail Wheel Trade Filters (busy options, a real business, below fair value, Piotroski 6 or more, debt it can repay, a Red Flags score of 60 or more, implied volatility of 25-80%, a $1 billion company, $5 a share) and a ranking of how strongly a stock passes on value, premium, moat, health, red flags, option trading and stability. A stock that fails any filter stays under 70; 70-84 is Good, 85 and above is Prime. The Sunday Scan is the top 10 that pass, sorted by Wheel Score.
What is the GLS fair value for MERC?
2.20 per share as of 5 Nov 2026 - the simple average of the 1 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Mercer International Inc. report earnings next?
The next earnings report is due on 5 Nov 2026 (after the close), 0 days from the data date of 5 Nov 2026. The Calendars page lists every upcoming report with its time of day.
Does MERC have listed options, and how liquid are they?
Yes. The nightly snapshot found 50 listed contracts with 32,720 open interest across all expiries and implied volatility of 315% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.