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    Meren Energy (TSX:MER) Could Be 10% Undervalued After Strong EBITDAX And Dividend Update

    Simply Wall St·09/09/2026 05:19:51
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    Meren Energy (TSX:MER) is drawing fresh attention after reporting first half 2026 EBITDAX of about US$220 million, paired with a trailing dividend yield near 9.3% and low net debt relative to EBITDAX.

    The recent financial update has landed alongside a strong run in Meren Energy’s share price, with a year to date share price return of 20.32% and a 30 day share price gain of 11.94% from a latest close of CA$2.25.

    For income focused holders, the picture looks different when dividends are included. A 1 year total shareholder return of 43.22% contrasts with a 3 year total shareholder return that has fallen 15.40%, suggesting momentum has only really picked up again over the past year.

    Scan income-focused opportunities beyond Meren Energy by reviewing our hand picked 2 dividend fortresses, which share a focus on yield and balance sheet resilience.

    Bulls point to Meren Energy’s high yield, EBITDAX and balance sheet, while bears flag the recent net loss and share price run up. Which story fits the current valuation?

    Most Popular Narrative: 10% Undervalued

    Meren Energy is currently trading at CA$2.25 compared with a widely followed narrative fair value of about CA$2.50. This frames the recent share strength against expectations for its long project pipeline.

    The fully funded Venus development project in Namibia, with a potential Final Investment Decision in early 2026 and First Oil expected by 2029, positions Meren Energy for significant long-life production and sustainable cash flow, supporting future revenue and earnings growth.

    Read the complete narrative. Read the complete narrative.

    Want to see what sits underneath that CA$2.50 fair value mark? The narrative leans on falling revenue, sharply improving margins and a future earnings multiple that reshapes today’s loss making profile. Curious which exact mix of long dated projects and modeled profitability has to line up to make that price make sense.

    Result: Fair Value of CA$2.50 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    Still, Meren Energy’s reliance on long lead projects like Venus and Preowei, along with ongoing dividend and debt commitments, could strain its flexibility if timelines or costs shift.

    Find out about the key risks to this Meren Energy narrative.

    Next Steps

    Mixed messages on Meren Energy so far, right. If that mix of concerns and potential has you thinking hard, move fast and test the numbers yourself with 3 key rewards and 1 important warning sign

    Looking for more investment ideas beyond Meren Energy?

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.