First Merchants Corporation
$38.90
-1.6%First Merchants Corporation operates as the financial holding company for First Merchants Bank that provides community banking services. It accepts time, savings, and demand deposits; and provides consumer, commercial, agri-business, and real estate mortgage loans, as well as public finance. The company also offers personal and corporate trust; brokerage and private wealth management; and letters of credit, repurchase agreements, and other corporate services. It operates 109 banking locations in Indiana, Illinois, Ohio, and Michigan counties. The company also offers its services through electronic and mobile delivery channels. First Merchants Corporation was founded in 1893 and is headquartered in Muncie, Indiana.
At a Glance
Live SnapshotIntrinsic Alpha Methodology
Thesis Lenses
Signal
High confidenceValuation multiple is compressed (P/E 10.0).
Valuation inputs: P/E 10.0, earnings yield +10.0%, momentum -1.6%.
If multiples stay elevated while momentum fades, downside repricing risk rises.
Driver
High confidenceReturn profile is soft (ROE +9.2%, ROIC -4.3%).
Profitability stack: net margin +21.5%, ROE +9.2%, ROIC -4.3%.
Quality deterioration often appears in margins before it shows up in headline EPS.
Risk
High confidenceRisk profile is balanced but has notable pressure points to monitor.
Risk factors: liabilities/assets +87.0%, momentum -1.6%, net margin +21.5%.
Higher leverage with weak momentum and thin margins can amplify drawdown severity.
First Merchants Corporation Market vs Earnings Trajectory
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First Merchants Corporation Fair Value Envelope
First Merchants Corporation Profit Bridge
Profitability Analysis
Gross Margin
Exceptional pricing power and cost management. The company retains over half of revenue after direct costs.
Operating Margin
Healthy operating margins demonstrate effective cost control and strong business fundamentals.
Net Profit Margin
Exceptional profitability. The company converts a significant portion of revenue to bottom-line earnings.
Effective Tax Rate
Below-average tax rate suggests effective tax planning, favorable jurisdictions, or tax credits.
Profitability Insight
Exceptional profitability across all levels: Strong pricing power, efficient operations, and healthy bottom line indicate a high-quality business with sustainable competitive advantages.
First Merchants Corporation Cash Conversion Engine
Cash Flow Quality Analysis
FCF Conversion Rate
Excellent cash generation. The company converts earnings to cash at or above 100%, indicating high-quality earnings.
FCF Growth Trend
Steady FCF growth indicates consistent cash generation improvement. On a positive trajectory.
Working Capital Impact
Minimal working capital impact on FCF. Changes in operating assets and liabilities well-managed.
Cash Flow Quality Insight
Asset-light with strong cash conversion: Low capital requirements combined with efficient cash generation creates significant shareholder value through dividends, buybacks, or strategic investments.
First Merchants Corporation Funding & Solvency Profile
Financial Health Analysis
Debt-to-Equity Ratio
High financial leverage. Heavy reliance on debt may indicate increased financial risk and potential solvency concerns.
Working Capital
Strong working capital position provides significant operational flexibility and financial cushion.
Asset Composition
Capital-intensive business with significant long-term investments in property, equipment, or intangibles.
First Merchants Corporation Street Expectations Map
Wall Street analysts project that FRME stock may rise significantly over the coming 12 months. The consensus 1-year price target stands at 49.00, with estimates ranging from a low of 49.00 to a high of 49.00.
The consensus 1-year price target stands at 49.00, with estimates ranging from a low of 49.00 to a high of 49.00.
Analyst Consensus Analysis
Upside Potential
Substantial upside potential. Analysts see significant value gap, suggesting the stock may be materially undervalued at current levels.
Analyst Agreement
High analyst agreement. Narrow target range indicates strong consensus on valuation, suggesting clear investment thesis and predictable outlook.
Analyst Conviction
Strong buy conviction: High upside with tight consensus suggests compelling investment opportunity backed by analyst confidence.
Market Sentiment Insight
Rare opportunity: Exceptional upside potential with strong analyst consensus creates a compelling setup. The combination of significant price target premium and tight agreement suggests high-conviction undervaluation that may attract institutional capital.
First Merchants Corporation Insider Positioning
During the last 12 months, insiders have purchased $3.50M and sold $1.49M worth of FRME shares, resulting in $2.01M of net buying activity.
3 Months
0
0.00
0
0.00
+0
+$0
3-6 Months
0
0.00
12.4K
518.56K
-519K
-$519K
6-9 Months
7.5K
282.52K
5.7K
202.24K
+80K
+$80K
9-12 Months
85.7K
3.22M
20.7K
769.70K
+2.4M
+$2.45M
Top Buyers
Hardwick Mark K
Director, Officer: Chief Executive Officer
$787K
Stewart Michael J
Officer: President
$600K
Kawiecki Michele
Officer, Other: Chief Financial Officer
$487K
Martin John
Officer, Other: Chief Credit Officer
$300K
Peterson Joseph C
Officer: Chief Commercial Officer
$300K
Top Sellers
Fluhler Stephan
Officer, Other: Chief Information Officer
$422K
Hardwick Mark K
Director, Officer: Chief Executive Officer
$314K
Stewart Michael J
Officer: President
$210K
Myers Larry W
Director, Officer: First Vice President
$208K
Scurlock Eva D.
Officer: Chief Risk Officer
$136K
Insider Activity Analysis
Net Insider Sentiment
Positive insider sentiment with $2.01M net buying. Buying activity substantially exceeds selling, indicating insider confidence.
Buy/Sell Ratio
Strong buy/sell ratio. Buying is at least double the selling activity, suggesting robust insider confidence.
Insider Participation
5 insider buyers and 5 sellers. Equal participation suggests mixed or neutral insider views.
Insider Activity Insight
Compelling insider conviction: The combination of strong buy/sell ratio and multiple buyers suggests insiders see attractive risk/reward. Consider this alongside fundamental analysis for confirmation.
frme Dividend History
Learning Layer
Related Guides
Build conviction on FRME by pairing this stock hub with focused valuation guides.
Research Paths
Snapshot
Start with context, operating signals, and key market metrics.
Value Model
Stress test fair value across bear, base, and bull assumptions.
Statements
Validate revenue quality, margins, and balance sheet durability.
Earnings Call
Read management commentary and compare it with reported outcomes.
Dividends
Check payout sustainability and long-term distribution behavior.
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.