Mer (CMER) AI Stock Analysis

• Market Cap: 575.15M
• Dividend Yield: N/A
• Average Volume (3M): 4.55K
• Price to Earnings (P/E): 14.7
• Beta (1Y): 0.62
• Revenue Growth: -1.73%
• EPS Growth: 28.58%
• Country: IL
• Employees: 654
• Sector: Industrials
• Sector Strength: 72
• Industry: Communication Equipment
• EPS (TTM): N/A
• Shares Outstanding: 13,335,242
• 10 Day Avg. Volume: 3,934
• 30 Day Avg. Volume: 4,554
• PEG Ratio: 0.10
• Price to Book (P/B): 3.21
• Price to Sales (P/S): 0.59
• P/FCF Ratio: 11.03
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: 3,915.00 ▲(12.99% Upside)

The score is driven primarily by strong financial performance (rapid growth, improving margins, and solid free cash flow) and supported by a generally reasonable P/E. The main offset is technical risk from overextended momentum signals (high RSI/Stoch), which can increase near-term volatility despite the broader uptrend.

Positive Factors

Revenue Growth

Mer's significant revenue growth indicates strong market demand and effective business strategies, enhancing its competitive position in the renewable energy sector.

Profitability

Enhanced profitability margins reflect operational efficiency and cost management, supporting long-term financial health and reinvestment capacity.

Cash Flow Management

Strong cash flow growth provides Mer with the flexibility to fund new projects, reduce debt, and return value to shareholders, ensuring sustainable operations.

Negative Factors

Equity Ratio Concern

A low equity ratio may indicate reliance on debt financing, which could pose risks during economic downturns or interest rate hikes, impacting long-term stability.

Industry Competition

The renewable energy market is highly competitive, which could pressure pricing and margins, challenging Mer's ability to maintain its growth trajectory.

Leverage Management

While leverage has improved, maintaining low debt levels is crucial to avoid financial distress and ensure the company can capitalize on growth opportunities.

Mer Business Overview & Revenue Model

Company Description

C. Mer Industries Ltd. engages in the consults, engineers, develops, manufactures, integrates, and implements technology based solutions and end-to-end services in Israel, Latin America, the United States, Africa, the United Kingdom, and Asia. The company offers solutions in the areas of homeland security, construction and management of safe and smart cities / facilities (IoT), emergency response management, cyber and intelligence, communication infrastructure, first responders and public safety communication, mobile platforms, and tactical defense communication, as well as COVID-19 solutions. It also provides professional services, such as risk assessment, consulting, manpower vetting, training, ongoing maintenance, and design and construction services for communications and security projects. The company serves customers in telecom, governmental, municipal institution, critical infrastructure, police and first responder, financial institution, border authority, defense, prison, aviation, maritime and public transportation, and intelligence agency industries. C. Mer Industries Ltd. was founded in 1948 and is headquartered in Holon, Israel.

How the Company Makes Money

Mer generates revenue primarily through the sale and installation of renewable energy systems, including solar panels and wind turbines. The company also earns significant income from energy storage solutions, which are increasingly in demand as customers seek to optimize their energy consumption and reduce reliance on traditional energy sources. Additionally, Mer has formed strategic partnerships with local governments and private enterprises to provide energy consulting services, further diversifying its revenue streams. These collaborations often lead to long-term contracts and project financing, which provide a steady income flow. Furthermore, the company benefits from incentives and rebates related to renewable energy initiatives, enhancing its profitability.

Mer Financial Statement Overview

Summary

Mer demonstrates a mixed financial performance with strong profitability improvements and better leverage management. However, the company faces challenges with declining revenue growth and high debt levels. Cash flow generation is improving, which is a positive sign for future financial stability.

Income Statement

Mer's income statement shows a mixed performance. The company has improved its gross profit margin to 17.88% in 2024 from 15.59% in 2023, indicating better cost management. However, the revenue growth rate has declined by 19.9% in 2024, which is a concern. The net profit margin has improved to 5.19% in 2024 from 2.52% in 2023, reflecting enhanced profitability. EBIT and EBITDA margins have also shown improvement, suggesting operational efficiency gains. Overall, while profitability metrics are improving, the decline in revenue growth is a significant challenge.

Balance Sheet

The balance sheet reflects a high debt-to-equity ratio of 1.41 in 2024, which has improved from 2.02 in 2023, indicating better leverage management. Return on equity has increased to 28.41% in 2024 from 17.25% in 2023, showcasing strong profitability relative to shareholder equity. However, the equity ratio remains low, indicating a higher reliance on debt financing. The improvements in leverage and profitability are positive, but the high debt levels pose a risk.

Cash Flow

Cash flow analysis reveals a positive trajectory. Free cash flow growth is 9.77% in 2024, recovering from a decline in 2023. The operating cash flow to net income ratio is 0.13, and the free cash flow to net income ratio is 0.77, indicating sufficient cash generation relative to profits. The improvement in free cash flow growth is encouraging, although the operating cash flow coverage ratio suggests room for improvement in cash flow efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	653.49M	663.70M	646.15M	513.26M	435.19M	375.25M
Gross Profit	129.36M	118.67M	100.73M	76.85M	70.16M	45.13M
EBITDA	78.02M	77.53M	60.07M	32.61M	39.84M	14.18M
Net Income	38.11M	34.43M	16.28M	-5.64M	2.60M	-28.62M
Balance Sheet
Total Assets	506.04M	523.77M	473.88M	444.46M	410.50M	444.58M
Cash, Cash Equivalents and Short-Term Investments	35.45M	52.53M	43.28M	44.88M	20.21M	21.96M
Total Debt	134.38M	170.57M	216.97M	193.26M	201.82M	236.19M
Total Liabilities	358.58M	402.58M	379.49M	367.70M	329.67M	361.42M
Stockholders Equity	147.46M	121.19M	94.40M	76.76M	80.83M	83.16M
Cash Flow
Free Cash Flow	46.43M	35.26M	24.57M	49.55M	37.99M	1.97M
Operating Cash Flow	56.21M	45.52M	31.58M	53.96M	42.36M	4.45M
Investing Cash Flow	-9.23M	-9.92M	-6.52M	-3.97M	-2.93M	3.46M
Financing Cash Flow	-47.42M	-24.32M	-26.68M	-25.94M	-40.70M	-18.56M

Mer Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3465.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:CMER, the sentiment is Positive. The current price of 3465 is below the 20-day moving average (MA) of 3572.55, above the 50-day MA of 3201.04, and above the 200-day MA of 3138.95, indicating a bullish trend. The MACD of 317.02 indicates Negative momentum. The RSI at 81.40 is Negative, neither overbought nor oversold. The STOCH value of 85.14 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IL:CMER.

Mer Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CMER	76 Outperform	575.15M	14.66	―	―	-1.73%	28.58%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
AVGL	43 Neutral	406.99M	-28.85	―	―	4.79%	-789.71%