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Mercer International Inc. (MERC) – A Stock from the Basic Materials Sector

Source: http://Blog.QualityStocks.net/?p=12075
Posted on Tuesday, September 2nd, 2008 | In Small & Micro Cap
Contributed by: QualityStocks (http://QualityStocks.net) -

Every professional stock investor longs for stocks from the Basic Materials Sector. There is no better substitute for creating bases of trans-generational wealth. High-technology is a capricious mistress, whereas world demand for basic materials will continue as it has for decades.

The weaknesses of this small-capital stock from Vancouver, BC are also its strengths. It is a matter of perspective, and just right for the thinking stock investor who simply refuses to follow the herd at any cost.

The company has lost nearly 2% of market capitalization in the 100 days preceding the start of September 2008. Much of the corporation’s production originates in Canada for customers across the Atlantic. This means that sales and profits have been sluggish against the headwinds of declining dollar values. The company has a 24.12% sales growth over the past five years, with a Gross Margin steady at 21.86% over this period. Additionally, the company has production capacity in the Euro zone of Germany.

More than one financial institution has reacted to declines in business performance during the most recent quarter by selling their stocks, but the investors who have picked up these stakes just might have the collective last laugh. The company has a significant technical moat that should appreciate as customers become more environment-conscious.

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