First Merchants Corporation (FRME) fair value: what the stock is really worth
As of Nov 6, 2026: fair value (intrinsic value) of First Merchants Corporation stock $36.34, price $40.83, that is 11.0% below the price, quality 51 out of 100. Rating: overvalued. Calculated from audited financials with 6 of our 26 valuation models and 37 quality factors, updated daily.
69 individual criteria per stock, every one traceableSee the method →
Price vs Fair Value
White line = price, green steps = our fair value per fiscal year. As of Nov 7, 2026.
How to read this chart
60‑month range $21.68 – $44.83 · fair‑value band $32.10 – $43.02 · the $40.83 price screens above the $36.34 fair value. Green steps = our fair value per fiscal year (point-in-time, no hindsight). As of Nov 7, 2026.
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First Merchants Corporation operates as the financial holding company for First Merchants Bank that provides commercial and consumer banking services.
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The company offers a range of financial services, including checking, savings, and deposit products; debit and credit cards; mortgages, refinance, construction or renovation of residential properties, agricultural lending, treasury management services and depository products.
It also provides personal and commercial wealth management services, brokerage, investment management, private banking, fiduciary estate, and financial planning services. The company operates banking locations in Indiana, Ohio, and Michigan counties.
It offers its services through electronic and mobile delivery channels. First Merchants Corporation was founded in 1893 and is headquartered in Muncie, Indiana.
Stock analysis
First Merchants Corporation (FRME) currently trades at $40.83, while our model-based Fair Value estimate is $36.34, 11% below the price, so the stock looks overvalued today.
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Valuation
Bull case: the Multiples group reads highest at a median of $42.80 per share, and 1 of the 6 models we run sit above the $40.83 price.
Bear case: the Asset-Based group reads lowest at $18.57, and 5 of the 6 models stay below the price. Data coverage for this calculation is high.
Scenario range: $32.10 (bear) to $43.02 (bull), the price of $40.83 sits inside it. Bear and bull are the same models on cautious and optimistic assumptions, a range, not a price target.
Quality & growth
The Quality Score stands at 51/100 (solid quality), in the Financial Services sector.
Mixed Growth: Revenue is growing, but margins or cash flow do not fully confirm the trend.
First Merchants Corporation reported revenue of $1.1B in FY2025 versus $556M in FY2021, a compound +17.2%/yr. Reported net income was $226M in FY2025, compounding +2.4%/yr from FY2021.
Key figures
Market cap $2.6B Mid · P/E ratio 12.7 · P/S ratio 3.78 · EPS (TTM) $3.22 · Dividend yield 3.6% · Net margin 29.2% · Return on equity 7.8% · Return on assets (EBIT) 1.4% (5-year average).
Competitive moat
Our AI-assisted moat analysis scores the competitive advantage at 66 out of 100 (low confidence).
What moves the price
The share trades about 9% below its 52-week high and 21% above its 52-week low, currently above its 200-day average.
For context, the median of 10 Financial Services peers we cover trades at −28% fair-value upside, at −11%, FRME screens cheaper than that median.
Fair Value models
Bear$32.10Fair Value $36.34Bull$43.02
Price $40.83 · Downside -11.0%
Model ⓘEach model values the company its own way (discounted cash flow, earnings, assets, dividends). The fair value above starts from their evidence-weighted blend, not from a single model. In cyclical trough or peak years, after dilution or a stock split it is adjusted afterwards, so it can sit above or below the models. Based on fiscal year 2025 figures (about 10 months old). Earnings retained since then ($1.50 per share) are deliberately not added.Bear ⓘBear = the cautious scenario: the same model computed with conservative anchors (lower growth, margins and valuation multiples). Together with Bull it frames a plausible valuation range, not a price target.BaseBull ⓘBull = the optimistic scenario: the same model computed with favourable anchors (higher growth, margins and valuation multiples). Together with Bear it frames a plausible valuation range, not a price target. If a model's bull case is above four times its base value, the table shows that limit with a > sign (like the overall Bull above): beyond it no assumption holds.Coverage ⓘCoverage = how well-backed THIS model's estimate is for this stock (0–100): how complete and reliable its input data are, and how well the model fits the company. The final Fair Value is an evidence-weighted blend, so better-evidenced models count more. Green ≥70, amber 50–69, grey below 50.
In the last 6 months, 2 officers or directors sold shares worth $1.0M and none bought.
SaleStephan FluhlerChief Information Officer2× since Feb 11, 2026: 8,241 shares, avg. $42.57$350,852Aug 19, 2026
SaleLarry W MyersDirector3× since Feb 26, 2026: 25,000 shares, avg. $41.70$1.0MJun 12, 2026
SaleEva D. ScurlockChief Risk Officer3,227 shares at $42.29$136,470Feb 6, 2026
Plus 31 other filings such as grants, option exercises or tax withholding. They are not market purchases or sales.
Sales are often planned (taxes, diversification, 10b5-1 plans). Purchases with their own money are seen as the stronger sign. For information only: not part of the quality score or Fair Value.
Growth Quality ⓘGrowth is valuable only when reinvestment earns attractive returns (Aswath Damodaran): sustainable growth depends on return on capital, reinvestment and efficiency. Basis: total company revenue over the periods shown on the cards (3Y/5Y/all years), not per share, so a merger can show up as a growth jump; per-share earnings growth is in the value-creation card.88/100
Revenue is growing, but margins or cash flow do not fully confirm the trend.
Revenue growth 1 year
−0.3%
Revenue growth 3 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+13.8%
Revenue growth 5 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+13.5%
Start year 2020 (pandemic). Over 10 years: +14.1% a year
Revenue growth 36 years ⓘMeasures the company's TOTAL revenue from reported annual statements: compound average growth per year (CAGR) from the fiscal year 3, 5 or N years back to the most recent comparable fiscal year. Not per share: buybacks do not change this number, and a merger can appear as a growth jump. Per-share growth (which does include buybacks) is in the value-creation card.
+8.8%
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What shareholders gained per year (last 5 years) ⓘWhat the business itself delivers per year: earnings growth per share plus the dividend yield. This is what you get IF the market keeps valuing the stock the same way: it contains no assumption about the market changing its mind. Computed per share, so buybacks count and a merger does not pass as growth. For a company that pays no dividend it is pure earnings growth per share. Period: earnings growth per share as CAGR over the last 5 reported fiscal years (annual statements), plus the current dividend yield. The start value is the median of the three years around the start, so a single crisis year (a pandemic or a write-down) does not distort the rate.
+7.8%
Earnings growth per share plus dividend.
Earnings per share, growth per year+4.2%
Dividend (yield on the price)3.6%
Pace: 5 vs 10 years ⓘTwo data points, not a trend model: earnings growth per share over the last 5 fiscal years against the last 10. Labelled "steady" when both rates are within 3 percentage points of each other, otherwise picking up or flattening. Shown only when ten years of history exist.4.2% vs 8.6%, slowing
Profit margin 2020 to 2025 ⓘOperating margin then vs now, from reported annual statements. A falling margin after a boom year is the classic peak-earnings signal: the growth rate then leans on an inflated base.30% → 25%
AI conclusion: Substantial growth via multiple acquisitions highlights operational strength, but the typical regional bank profile shows limited distinct moat signals in a competitive sector.
Main risk: The leadership transition risks exposing gaps in adapting to normalizing credit conditions, potentially affecting net interest margins and commercial lending performance.
First Merchants grew substantially through eighteen acquisitions during its CEO's nearly three-decade tenure. The board's choice of the long-time bank president as successor signals a deliberate emphasis on internal continuity for this Midwest regional player. Will the transition preserve the recent gains in net interest margin and commercial lending, or expose gaps in adapting to normalizing credit conditions?
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Peer GroupⓘHow this stock ranks against its industry: the green marker is this stock, the band is the typical 25–75% peer range, and the tick is the median.Banks - Regional · 998 stocks
Beats the industry median on 8/15 measures
A mixed picture versus its industry peers.
Valuation
Quality Score51 · Below median
Fair Value upside−11.0% · Above median
Profitability
Return on equity (12 months)7.8% · Below median
Return on assets1.2% · Above median
Net margin (12 months)29.2% · Below median
Operating margin (12 months)45.0% · Above median
Growth and dividend
Revenue growth (quarter YoY)21.0% · Top 25%
Dividend yield (12 months)3.6% · Above median
Balance sheet
Debt / equity0.35× · Above median
Valuation Multiplesvs Banks - Regional median · lower = cheaper
P/E (12 months)12.7× · Pricier than median
P/B1.04× · Cheaper than median
P/S (12 months)3.78× · Pricier than median
Price / free cash flow (fiscal year)9.0× · Cheaper than median
EV/EBITDA11.5× · Pricier than median
PEG1.40× · Cheaper than median
Strength profile in five axes (Snowflake)
This stockSector peers
VALUE (fair-value potential)19· sector 8
FUTURE (revenue growth)100· sector 47
PAST (return on equity)31· sector 43
HEALTH (low debt)–
DIVIDEND (yield)72· sector 53
HEALTH: for banks, insurers and similar financial firms borrowed money is part of the business, so we do not rate debt here.
For bloggers, editors and developers: paste this into your site or blog (a “Custom HTML” block in WordPress), it shows the current fair value and links back here. Free, plain HTML, and welcome. Full data streams (CSV/JSON) at /developers.
Is First Merchants Corporation (FRME) overvalued or undervalued?
As of Nov 7, 2026, our model estimates a fair value of $36.34 versus a price of $40.83, about 11% lower (overvalued).
What is the fair value of FRME?
Our model-based fair value for First Merchants Corporation is $36.34 (as of Nov 7, 2026), built from audited fundamentals. The current price: $40.83.
What is the quality score of FRME?
First Merchants Corporation has a Quality Score of 51/100. It measures business quality (profitability, growth, cash flow, balance-sheet strength, investment discipline, share issuance). Market factors such as price momentum and volatility do not enter the number; they are shown separately in the detail view.
What is the price target for First Merchants Corporation (FRME)?
Our model-based price target is the fair value of $36.34 (as of Nov 7, 2026) from 6 valuation models. Cautious scenario $32.10, optimistic scenario $43.02. It is a calculation from audited fundamentals, not an analyst target.
What is the First Merchants Corporation stock forecast for 2026?
Our models put fair value at $36.34, about 11% lower versus a price of $40.83 (overvalued). Cautious scenario $32.10, optimistic scenario $43.02. The calculation is refreshed regularly with new filings.
What is the revenue of First Merchants Corporation (FRME)?
First Merchants Corporation reported trailing-twelve-month revenue of about $676M (latest available figure, as of Nov 7, 2026).
Does First Merchants Corporation pay a dividend?
First Merchants Corporation currently shows a dividend yield of 3.58% relative to its recent price (as of Nov 7, 2026).
How much is the dividend of First Merchants Corporation (FRME) and when is the ex-dividend date?
First Merchants Corporation pays a dividend of $1.46 per share a year, a dividend yield of 3.6%. The last ex-dividend date was Sep 4, 2026. A dividend has been paid every year since at least 1989. The payout ratio is 45.3% of earnings. Our assessment: Low payout. A low payout ratio: the dividend takes at most 60 % of earnings. Whether free cash flow covers it as well, we cannot see for this company.
What is the intrinsic value of First Merchants Corporation (FRME)?
Intrinsic value and fair value mean the same thing: what the business is worth on its numbers, independent of the share price. For First Merchants Corporation it is $36.34 per share (as of Nov 7, 2026), against a price of $40.83. It is the blended result of 6 valuation models in 4 families (Dividend Discount, Multiples, Asset-Based, Economic Profit).
Is First Merchants Corporation stock overvalued or undervalued in 2026?
As of Nov 7, 2026, FRME trades above its calculated fair value: price $40.83, fair value $36.34, a gap of about −11% (overvalued). The calculation is refreshed with each new quarterly report, so the verdict can change during the year.
Is fair value the same as the market price of FRME?
No. The price is what the market pays today ($40.83); the fair value is what the company's own numbers justify ($36.34). For First Merchants Corporation the two are $4.49 per share apart. That gap is exactly why we show both numbers side by side.
How much is First Merchants Corporation worth?
The market values First Merchants Corporation at about $2.6B (market capitalisation, as of Nov 7, 2026). Per share that is $40.83; our models calculate a fair value of $36.34 per share.
What do the bullish and bearish scenarios say about FRME?
Our models span a range for First Merchants Corporation: cautious scenario $32.10, base $36.34, optimistic $43.02 per share (as of Nov 7, 2026, price $40.83). The range comes from different growth and margin assumptions, not from analyst opinions.
What is the P/E ratio of FRME?
First Merchants Corporation trades at a price-to-earnings ratio of 12.7 (as of Nov 7, 2026). A P/E on its own says little: it compares the price with ONE year of profit, while our fair value of $36.34 is built from several models across several years. Median P/E at fiscal year-end, 10 fiscal years (2016 to 2025), reported earnings, FY2023, FY2024 ex one-offs: 11.9. Other multiples: PEG 1.4, P/B 1.0, P/S 3.8, EV/EBITDA 11.5.
What is the PEG ratio of FRME?
The PEG ratio of First Merchants Corporation is 1.40 (P/E divided by earnings growth, as of Nov 7, 2026). That is above 1, so the growth is already paid for in the price.
How solid is the balance sheet of First Merchants Corporation (FRME)?
Balance-sheet figures for First Merchants Corporation (as of Nov 7, 2026): return on equity 7.8%, debt of 0.35 per unit of equity. They feed the Quality Score of 51/100, which measures business quality independently of the share price.
How far is FRME from its 52-week high?
First Merchants Corporation trades at $40.83, about 9% below its 52-week high of $44.83 and 21% above the low of $33.72 (as of Nov 6, 2026). Distance from the high says nothing about value: that is what the fair value of $36.34 is for.
Which stocks are comparable to First Merchants Corporation?
From the same area (Financial Services) we also value China Merchants Bank Co, DBS Group, UniCredit S.p.A, Mizuho Financial Group, among others. Each of them has its own fair-value calculation on this site using the same models, so the comparison is like for like.
Is First Merchants Corporation stock attractive at the current price?
The data as of Nov 7, 2026: price $40.83, calculated fair value $36.34 (−11%), Quality Score 51/100, from 6 models. Whether that fits your horizon and risk tolerance is your call. We provide the calculation, not investment advice.
How is the fair value of FRME calculated?
We run First Merchants Corporation through 6 models from 4 families: Dividend Discount, Multiples, Asset-Based, Economic Profit. Every model gets the same audited fundamentals; the fair value of $36.34 builds on their evidence-weighted average, with the spread shown as a cautious and an optimistic scenario.
Is it still worth investing in stocks now?
The global stock market currently sits 13.0% above its aggregate fair value. First Merchants Corporation itself currently trades above fair value. An expensive market is no reason to stay out and no reason to buy everything at once: keep a broad savings plan running, buy single stocks only with money you can do without, and hold part of your money liquid while the market is high. The full picture including sectors is on is it worth investing now.
What is the share price of First Merchants Corporation (FRME)?
The closing price on Nov 6, 2026 was $40.83. Our model-based fair value is $36.34, about 11% lower (overvalued). We carry closing prices from our data provider, not a live tick.
What should I pay attention to with First Merchants Corporation right now?
For a financial, book-value and earnings-based methods matter more than a cash-flow DCF, which fits banks and insurers poorly. The price sits in the upper half of our model range, so the margin of safety is thin. The data supports the verdict: every model runs on fully documented inputs.
Where does the earnings growth of First Merchants Corporation (FRME) come from?
Earnings per share at First Merchants Corporation grew +8.4 % a year from 2014 to 2025. Broken into its drivers: revenue per share +9.9 %, EBIT margin −3.2 %, tax rate +1.9 %, residual (interest, one-offs) +0.0 %. The four rates multiply to the earnings growth rate, they do not add up. Start and end are three-year averages so a single exceptional year does not distort the result.
Key figures of First Merchants Corporation
How large is the market capitalisation of First Merchants Corporation (FRME)?
The market capitalisation of First Merchants Corporation is $2.6B. The stock-market value of the whole company: share price times number of shares. It is what the market asks for the entire business today.
What is the P/S ratio of First Merchants Corporation (FRME)?
The price-to-sales ratio of First Merchants Corporation is 3.78 (last twelve months). Price to sales: market value relative to yearly revenue. Useful when profit is thin or distorted.
What are the earnings per share of First Merchants Corporation (FRME)?
Earnings per share at First Merchants Corporation are $3.22 (price ÷ EPS = P/E 12.7). Earnings per share over the last twelve months: total profit spread across every single share.
What is the dividend yield of First Merchants Corporation (FRME)?
The dividend yield of First Merchants Corporation is 3.6% (payout 45.3%). Yearly dividend relative to the share price. 3% pays 3 per 100 invested. Below: how much of profit is used for it.
What is the net margin of First Merchants Corporation (FRME)?
The net margin of First Merchants Corporation is 29.2% (last twelve months). How much of every unit of revenue ends up as profit. 10% means 10 cents of profit per dollar of sales.
What is the return on equity of First Merchants Corporation (FRME)?
The return on equity (ROE) of First Merchants Corporation is 7.8% (last twelve months). Profit relative to shareholders' equity, how efficiently the company works with its owners' money.
What is the EBIT return on assets of First Merchants Corporation (FRME)?
On an EBIT basis the return on assets of First Merchants Corporation is 1.4% (avg 5y). Operating profit (EBIT) relative to everything the company owns, as a multi-year average. It describes the business model rather than one good or bad year.
What is the operating margin of First Merchants Corporation (FRME)?
The operating margin of First Merchants Corporation is 45.0% (last twelve months). Profit from the core business (before interest and taxes) relative to revenue.
How fast is revenue growing at First Merchants Corporation (FRME)?
Revenue at First Merchants Corporation is growing +21.0% versus a year earlier (3y avg +13.8%). How much revenue grew versus a year earlier (YoY). The 3-year average next to it puts the single year in context.
How fast are earnings growing at First Merchants Corporation (FRME)?
Earnings per share at First Merchants Corporation are growing +11.2% versus a year earlier. How much earnings per share grew versus a year earlier.
How much free cash flow does First Merchants Corporation (FRME) generate?
The free cash flow of First Merchants Corporation is $284M (fiscal year 2025). The cash truly left after running and investing in the business, this is what pays dividends and buybacks.
How much net debt does First Merchants Corporation (FRME) carry?
The net debt of First Merchants Corporation is $916M (fiscal year 2025, ≈ 3.2 yrs of FCF). Debt minus cash on hand. The note shows how many years of free cash flow could in theory pay it off.
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Broad data
Nov 7, 2026