Head to Head Survey: Mercer International (MERC) versus Wausau Paper Corp. (NYSE:WPP)
Mercer International (NASDAQ: MERC) and Wausau Paper Corp. (NYSE:WPP) are both small-cap basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitabiliy, earnings, analyst recommendations and dividends.
Insider & Institutional Ownership
81.2% of Mercer International shares are held by institutional investors. 4.9% of Mercer International shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
This table compares Mercer International and Wausau Paper Corp.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Wausau Paper Corp.||1.79%||5.31%||1.52%|
Earnings & Valuation
This table compares Mercer International and Wausau Paper Corp.’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Mercer International||$920.56 million||0.80||$200.62 million||$0.54||21.11|
|Wausau Paper Corp.||N/A||N/A||N/A||N/A||N/A|
Mercer International has higher revenue and earnings than Wausau Paper Corp..
This is a summary of current ratings and price targets for Mercer International and Wausau Paper Corp., as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Wausau Paper Corp.||0||0||0||0||N/A|
Mercer International presently has a consensus target price of $16.00, suggesting a potential upside of 40.35%. Given Mercer International’s higher probable upside, analysts clearly believe Mercer International is more favorable than Wausau Paper Corp..
Mercer International pays an annual dividend of $0.46 per share and has a dividend yield of 4.0%. Wausau Paper Corp. does not pay a dividend. Mercer International pays out 85.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Mercer International beats Wausau Paper Corp. on 9 of the 11 factors compared between the two stocks.
About Mercer International
Mercer International Inc. is a producer of northern bleached softwood kraft (NBSK) pulp, which is pulp that is sold on the open market. The Company also produces and sells tall oil, a by-product of its production process, which is used as both a chemical additive and as a green energy source. It produces and sells NBSK pulp, which is a bleached kraft pulp manufactured using northern softwood. As of December 31, 2016, the Company operated two mills in Eastern Germany and one mill in Western Canada. As of December 31, 2016, its three NBSK pulp mills had consolidated annual production capacity of approximately 1.5 million air-dried metric tons (ADMTs) of NBSK pulp and were capable of generating 305 megawatts (MW) of electricity. Additionally, its German mills generate tall oil from black liquor, which is sold to third parties for use in various applications, including bio-fuels. The Company’s mills generate and sell energy to regional utilities.
About Wausau Paper Corp.
Wausau Paper Corp. (Wausau Paper) manufactures, converts and sells a line of towel and tissue products. The Company’s products are marketed along with soap and dispensing systems for the commercial and industrial away-from-home market. Under the Wausau Paper trademark, towel and tissue products, made primarily from recycled material, are marketed under a number of brands including Alliance, Artisan, DublSoft, DublNature, EcoSoft, OptiCore and Revolution. These products include washroom roll and folded towels; tissue products; a variety of towel, tissue, and soap dispensers; industrial wipers; dairy towels; household roll towels, and other towel and tissue products. The Company also offers controlled-use dispensing systems for the away-from-home market. The Company’s products are primarily sold within the United States and Canada.
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