The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Mercer International beat expectations on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped and GAAP earnings per share dropped to a loss.
Margins contracted across the board.
Mercer International reported revenue of $297.8 million. The two analysts polled by S&P Capital IQ anticipated revenue of $290.4 million on the same basis. GAAP reported sales were 9.6% lower than the prior-year quarter's $329.4 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at -$0.02. The two earnings estimates compiled by S&P Capital IQ averaged $0.08 per share on the same basis. GAAP EPS were -$0.04 for Q4 versus $0.86 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 12.3%, 1,750 basis points worse than the prior-year quarter. Operating margin was 1.3%, 1,920 basis points worse than the prior-year quarter. Net margin was -0.8%, 1,520 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $291.2 million. On the bottom line, the average EPS estimate is $0.13.
Next year's average estimate for revenue is $1.16 billion. The average EPS estimate is $1.55.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 160 members out of 173 rating the stock outperform, and 13 members rating it underperform. Among 46 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 46 give Mercer International a green thumbs-up.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Mercer International is outperform, with an average price target of $8.16.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.