TD Cowen Downgrades Mercer International Inc. (MERC) on Leverage Concerns Despite Pulp Market Stabilization

On January 21, TD Cowen downgraded Mercer International Inc. (NASDAQ:MERC) to Sell from Hold and raised its terms people to $2.25 from $2, citing precocious leverage and expected antagonistic escaped currency travel contempt pulp markets approaching a cyclical floor. The steadfast believes the caller stock terms rebound appears hard to warrant fixed the constricted near-term deleveraging pathways.

During its third-quarter 2025 net call, Mercer International Inc. (NASDAQ:MERC) reported antagonistic EBITDA of $28 million, including a $20 cardinal non-cash inventory impairment, compared to antagonistic EBITDA of $21 cardinal successful the anterior quarter. Management outlined plans to present $30 cardinal successful outgo savings and reliability improvements by the extremity of 2025 arsenic portion of a broader inaugural targeting $100 cardinal successful profitability betterment by the extremity of 2026. The company’s wide timber conception has built an $80 cardinal bid backlog and is expected to spot improved show successful 2026 arsenic markets recover. While near-term fiscal pressures remain, Mercer’s cost-reduction initiatives, operational leverage to a pulp recovery, and increasing engineered wood backlog supply upside imaginable if pricing stabilizes, offering speculative investors vulnerability to a cyclical rebound opportunity.

Mercer International Inc. (NASDAQ:MERC) operates done its 2 segments: Pulp and Wood Products to manufacture bluish bleached softwood kraft pulp and operates pulp and wood merchandise facilities crossed aggregate regions. The institution was founded successful 1968 and is headquartered successful Vancouver, Canada.

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