10 Best Lumber Stocks To Buy Right Now

7. Mercer International Inc. (NASDAQ:MERC)

Number of Hedge Fund Holders: 23

Mercer International Inc. (NASDAQ:MERC) is an American multinational company that specializes in manufacturing and selling pulp, solid wood, and various other products. The company focuses on pulp, biomaterials, biochemicals, and innovative lumber products like cross-laminated timber. Mercer International Inc. (NASDAQ:MERC) is one of the best lumber stocks to buy.

In the third quarter of 2024, the company reported an operating EBITDA of $50.5 million, a notable increase from $37.5 million in the same quarter of 2023. This growth reflects Mercer International Inc.’s (NASDAQ:MERC) strong performance in softwood pulp markets and stable fiber costs. However, production was impacted by unplanned downtime at the Peace River mill, which limited pulp sales volumes. Fortunately, Mercer International Inc. (NASDAQ:MERC) was able to restart the Peace River mill earlier than expected, reducing downtime in the fourth quarter to just 12 additional days. The company has no further downtime planned for its pulp mills for the remainder of 2024, which should support improved operational efficiency moving forward.

In 2022, Mercer International Inc. (NASDAQ:MERC) acquired Holzindustrie Torgau for EUR 270 million, including net working capital. This transaction includes a value-add pallet production facility in Torgau, Germany and a wood processing facility in Dahlen, Germany. This acquisition has begun to pay off, with nearly $5 million in synergies realized by the end of Q3 2024. The company anticipates achieving about $8 million in total synergies by year-end and believes that once Torgau’s lumber capacity is fully operational, it can achieve annual synergies of $16 million. With a strong focus on expanding its business and operational efficiencies, Mercer International Inc. (NASDAQ:MERC) is well-positioned for future growth.