Mercer International (NASDAQ:MERC) and Lee & Man Paper Manufacturing (OTCMKTS:LMPMY) Critical Survey

Lee & Man Paper Manufacturing ( OTCMKTS:LMPMY – Get Your Free Report ) and Mercer International ( NASDAQ:MERC – Get Your Free Report ) are both basic materials companies, but which is the better stock? We’ll compare the two companies based on their institutional ownership strength, risk, dividends, valuation, analyst recommendations, profitability and earnings.

Analyst recommendations

This is a summary of recent recommendations and price targets for Lee & Man Paper Manufacturing and Mercer International, provided by MarketBeat.com.

Mercer International has a consensus target price of $9.38, suggesting a potential upside of 67.41%. Given Mercer International’s higher possible upside, analysts plainly believe Mercer International is more favorable than Lee & Man Paper Manufacturing.

dividends

Lee & Man Paper Manufacturing pays an annual dividend of $0.13 per share and has a dividend yield of 4.9%. Mercer International pays an annual dividend of $0.30 per share and has a dividend yield of 5.4%. Lee & Man Paper Manufacturing pays 3.2% of earnings as a dividend. Mercer International pays out -8.7% of earnings as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next few years. Mercer International is clearly the better dividend stock given its higher yield and lower payout ratio.

Institutional and insider ownership

0.0% of Lee & Man Paper Manufacturing shares are held by institutional investors. Comparatively, 85.8% of Mercer International shares are held by institutional investors. 4.2% of Mercer International shares are owned by insiders. Strong institutional ownership is an indication that endowments, big money managers and hedge funds believe the stock is poised for long-term growth.

return

This table compares Lee & Man Paper Manufacturing and Mercer International’s net margins, return on equity and return on assets.

Rating and Earnings

This table compares the gross revenue, earnings per share (EPS) and valuation of Lee & Man Paper Manufacturing and Mercer International.

Lee & Man Paper Manufacturing has higher earnings, but lower revenue than Mercer International. Mercer International is trading at a lower price-to-earnings ratio than Lee & Man Paper Manufacturing, indicating that it is currently the more affordable of the two stocks.

Summary

Mercer International beats Lee & Man Paper Manufacturing in 6 of the 11 factors compared between the two stocks.

About Lee & Man Paper Manufacturing

(Get a free report)

Lee & Man Paper Manufacturing Limited, an investment holding company, is engaged in the production and marketing of wrapping paper, pulp and tissue paper in the People’s Republic of China, Vietnam, Malaysia, Macao and Hong Kong. The company operates through the segments of wrapping paper, tissue paper and pulp. Offers various cellulose products such as dissolved cellulose for use in chemical viscose fibers, bamboo fibers, glass paper, acetate fibers, refined rayons, etc.; unbleached bamboo kraft pulp for use in ecru life papers, eco tableware, grocery bags, etc.; and bleached bamboo kraft pulp for use in tissue paper, fine paper, cigarette paper, cup paper, etc. The company also provides container board products, including kraft board and test board for use in cardboard boxes, graphic board, paper bags, file boxes, cartons, wallpaper, etc.; and corrugated liners for use in corrugated and septa-ply paperboard and honeycomb products. In addition, it offers coated duplex paperboard products for use in graphic boxes, color card printing and offset printing, as well as in the packaging of goods, home appliances, IT products, medicine/healthcare products, food products, toys, gifts, ceramic products, stationery, drinks, etc.; toilet rolls; and unbleached paper for use in various applications such as baby care, menstrual, facial, sensitive skin, table, kitchen, etc. Lee & Man Paper Manufacturing Limited was founded in 1994 and is headquartered in North Point, Hong Kong.

About Mercer International

(Get a free report)

Mercer International Inc., together with its subsidiaries, manufactures and sells Northern Bleached Softwood Kraft (NBSK) and Northern Bleached Hardwood Kraft (NBHK). The company operates through two segments, pulp and solid wood. It produces, sells and distributes pulp, electricity and chemicals through pulp mills. The company also manufactures, distributes and sells lumber, cross-laminated timber, joint lumber, glue-laminated timber, wood pallets, electricity, biofuels and wood residues. In addition, it generates and sells green energy produced from the biomass cogeneration power plant to third parties. In addition, it produces and sells NBSK pulp made from softwood; green energy using carbon-neutral biofuels such as black liquor and wood waste; black liquor tall oil for use as a chemical additive and green energy source; bio extractives and biomaterials, including lignin, turpentine, cellulose filaments and sandalwood oil; and biofuels; as well as provide transport and logistics services. The company sells its pulp in the pulp markets, to integrated paper and board producers; and timber to distributors, construction firms, secondary manufacturers, retail yards and housing centres. Mercer International Inc. was founded in 1968 and is headquartered in Vancouver, Canada.

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