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First Merchants

Nasdaq:FRME
Snowflake Description

Flawless balance sheet and good value.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
FRME
Nasdaq
$2B
Market Cap
  1. Home
  2. US
  3. Banks
Company description

First Merchants Corporation operates as the financial holding company for First Merchants Bank that provides community banking services. The last earnings update was 47 days ago. More info.


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FRME Share Price and Events
7 Day Returns
0.4%
NasdaqGS:FRME
-1.7%
US Banks
-0.4%
US Market
1 Year Returns
-22.2%
NasdaqGS:FRME
-6.9%
US Banks
4.3%
US Market
FRME Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
First Merchants (FRME) 0.4% 4.9% -2.6% -22.2% 48.7% 68.8%
US Banks -1.7% -0.7% 3.3% -6.9% 50.7% 38.5%
US Market -0.4% 2.8% 2.7% 4.3% 40.9% 38.2%
1 Year Return vs Industry and Market
  • FRME underperformed the Banks industry which returned -6.9% over the past year.
  • FRME underperformed the Market in United States of America which returned 4.3% over the past year.
Price Volatility
FRME
Industry
5yr Volatility vs Market

Value

 Is First Merchants undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of First Merchants to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for First Merchants.

NasdaqGS:FRME Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model Excess Returns Model
Stable EPS Weighted future Return on Equity estimates from 6 analysts.
= Stable Book Value * Return on Equity
= $32.30 * 11.5%
$3.70
Book Value of Equity per Share Weighted future Book Value estimates from 7 analysts. $32.30
Discount Rate (Cost of Equity) See below 7.7%
Perpetual Growth Rate 10-Year US Government Bond Rate 2.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NasdaqGS:FRME
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 2.7%
Equity Risk Premium S&P Global 6%
Banks Unlevered Beta Simply Wall St/ S&P Global 0.59
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.589 (1 + (1- 21%) (36.26%))
0.837
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.84
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.73% + (0.837 * 5.96%)
7.72%

Discounted Cash Flow Calculation for NasdaqGS:FRME using Excess Returns Model Model

The calculations below outline how an intrinsic value for First Merchants is arrived at using the Excess Return Model. This approach is used for finance firms where free cash flow is difficult to estimate.

In the Excess Return Model the value of a firm can be written as the sum of capital invested currently in the firm and the present value of excess returns that the firm expects to make in the future.

The model is sensitive to the Return on Equity of the company versus the Cost of Equity, how these are calculated is detailed below the main calculation.

Note the calculations below are per share.

See our documentation to learn about this calculation.

NasdaqGS:FRME Value of Excess Returns
Calculation Result
Excess Returns = (Stable Return on equity – Cost of equity) (Book Value of Equity per share)
= (11.5% – 7.72%) * $32.30)
$1.21
Terminal Value of Excess Returns = Excess Returns / (Cost of Equity - Expected Growth Rate)
= $1.21 / (7.72% - 2.73%)
$24.15
Value of Equity = Book Value per share + Terminal Value of Excess Returns
= $32.30 + $24.15
$56.45
NasdaqGS:FRME Discount to Share Price
Calculation Result
Value per share (USD) From above. $56.45
Current discount Discount to share price of $36.29
= -1 x ($36.29 - $56.45) / $56.45
35.7%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price First Merchants is available for.
Intrinsic value
36%
Share price is $36.29 vs Future cash flow value of $56.45
Current Discount Checks
For First Merchants to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • First Merchants's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • First Merchants's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for First Merchants's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are First Merchants's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NasdaqGS:FRME PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-03-31) in USD $3.27
NasdaqGS:FRME Share Price ** NasdaqGS (2019-06-26) in USD $36.29
United States of America Banks Industry PE Ratio Median Figure of 600 Publicly-Listed Banks Companies 12.61x
United States of America Market PE Ratio Median Figure of 3,094 Publicly-Listed Companies 17.77x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of First Merchants.

NasdaqGS:FRME PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NasdaqGS:FRME Share Price ÷ EPS (both in USD)

= 36.29 ÷ 3.27

11.09x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • First Merchants is good value based on earnings compared to the US Banks industry average.
  • First Merchants is good value based on earnings compared to the United States of America market.
Price based on expected Growth
Does First Merchants's expected growth come at a high price?
Raw Data
NasdaqGS:FRME PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 11.09x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 7 Analysts
14.5%per year
United States of America Banks Industry PEG Ratio Median Figure of 271 Publicly-Listed Banks Companies 1.3x
United States of America Market PEG Ratio Median Figure of 2,133 Publicly-Listed Companies 1.51x

*Line of best fit is calculated by linear regression .

NasdaqGS:FRME PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 11.09x ÷ 14.5%

0.76x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • First Merchants is good value based on expected growth next year.
Price based on value of assets
What value do investors place on First Merchants's assets?
Raw Data
NasdaqGS:FRME PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-03-31) in USD $29.45
NasdaqGS:FRME Share Price * NasdaqGS (2019-06-26) in USD $36.29
United States of America Banks Industry PB Ratio Median Figure of 603 Publicly-Listed Banks Companies 1.18x
United States of America Market PB Ratio Median Figure of 5,255 Publicly-Listed Companies 1.78x
NasdaqGS:FRME PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NasdaqGS:FRME Share Price ÷ Book Value per Share (both in USD)

= 36.29 ÷ 29.45

1.23x

* Primary Listing of First Merchants.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • First Merchants is overvalued based on assets compared to the US Banks industry average.
X
Value checks
We assess First Merchants's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Banks industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Banks industry average (and greater than 0)? (1 check)
  5. First Merchants has a total score of 4/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is First Merchants expected to perform in the next 1 to 3 years based on estimates from 7 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
14.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is First Merchants expected to grow at an attractive rate?
  • First Merchants's earnings growth is expected to exceed the low risk savings rate of 2.7%.
Growth vs Market Checks
  • First Merchants's earnings growth is expected to exceed the United States of America market average.
  • First Merchants's revenue growth is expected to exceed the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NasdaqGS:FRME Future Growth Rates Data Sources
Data Point Source Value (per year)
NasdaqGS:FRME Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 7 Analysts 14.5%
NasdaqGS:FRME Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 7 Analysts 12.8%
United States of America Banks Industry Earnings Growth Rate Market Cap Weighted Average 3.8%
United States of America Banks Industry Revenue Growth Rate Market Cap Weighted Average 3.8%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 13.9%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.4%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NasdaqGS:FRME Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 7 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NasdaqGS:FRME Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2020-12-31 528 201 6
2019-12-31 472 172 6
NasdaqGS:FRME Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2019-03-31 413 201 161
2018-12-31 408 180 159
2018-09-30 399 183 142
2018-06-30 385 151 125
2018-03-31 363 122 110
2017-12-31 339 127 96
2017-09-30 315 102 94
2017-06-30 297 129 91
2017-03-31 290 114 87
2016-12-31 286 104 81
2016-09-30 278 83 73
2016-06-30 271 53 69

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • First Merchants's earnings are expected to grow by 14.5% yearly, however this is not considered high growth (20% yearly).
  • First Merchants's revenue is expected to grow by 12.8% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NasdaqGS:FRME Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (2 months ago) See Below
Future Estimates Average of up to 7 Analyst Estimates (S&P Global) See Below

All data from First Merchants Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:FRME Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2020-12-31 3.61 3.68 3.50 7.00
2019-12-31 3.27 3.40 3.03 7.00
NasdaqGS:FRME Past Financials Data
Date (Data in USD Millions) EPS *
2019-03-31 3.27
2018-12-31 3.23
2018-09-30 2.88
2018-06-30 2.55
2018-03-31 2.32
2017-12-31 2.13
2017-09-30 2.18
2017-06-30 2.20
2017-03-31 2.12
2016-12-31 1.99
2016-09-30 1.82
2016-06-30 1.75

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Unable to establish if First Merchants will efficiently use shareholders’ funds in the future without estimates of Return on Equity.
X
Future performance checks
We assess First Merchants's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
First Merchants has a total score of 3/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has First Merchants performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare First Merchants's growth in the last year to its industry (Banks).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • First Merchants has delivered over 20% year on year earnings growth in the past 5 years.
  • First Merchants's 1-year earnings growth exceeds its 5-year average (47.2% vs 23.7%)
  • First Merchants's earnings growth has exceeded the US Banks industry average in the past year (47.2% vs 40.7%).
Earnings and Revenue History
First Merchants's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from First Merchants Company Filings, last reported 2 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:FRME Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-03-31 413.49 161.28 194.24
2018-12-31 408.09 159.14 191.88
2018-09-30 398.72 141.81 196.67
2018-06-30 385.11 125.05 195.53
2018-03-31 362.67 109.56 188.25
2017-12-31 339.15 96.07 179.90
2017-09-30 315.20 93.98 160.51
2017-06-30 296.84 90.68 152.34
2017-03-31 290.21 86.55 150.07
2016-12-31 286.02 81.05 152.07
2016-09-30 278.05 72.94 152.60
2016-06-30 270.81 68.94 150.52
2016-03-31 262.40 66.91 151.85
2015-12-31 256.34 65.38 147.17
2015-09-30 254.81 66.47 146.23
2015-06-30 253.24 65.52 144.41
2015-03-31 251.91 62.71 138.96
2014-12-31 245.45 60.16 140.13
2014-09-30 242.65 56.11 133.55
2014-06-30 226.11 49.96 127.68
2014-03-31 212.52 44.76 122.82
2013-12-31 203.63 42.15 120.91
2013-09-30 195.20 40.12 119.74
2013-06-30 197.48 40.25 117.69
2013-03-31 195.44 38.36 115.21
2012-12-31 188.40 40.58 112.00
2012-09-30 183.73 37.83 104.22
2012-06-30 177.69 21.35 103.91

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • First Merchants has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • First Merchants used its assets more efficiently than the US Banks industry average last year based on Return on Assets.
  • Unable to establish if First Merchants improved its use of capital last year versus 3 years ago (Return on Capital Employed) due to insufficient past data.
X
Past performance checks
We assess First Merchants's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Banks industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
First Merchants has a total score of 4/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is First Merchants's financial position? (This company is analysed differently as a bank or financial institution)

This company is a bank or financial institution.

Fundamentally a bank's business is based upon borrowing and lending money, for this reason they typically have high levels of debt and we analyse them differently.
Net Worth
Balance sheet
This treemap shows a more detailed breakdown of First Merchants's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from First Merchants Company Filings, last reported 2 months ago.

NasdaqGS:FRME Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-03-31 1,455.85 630.48 200.78
2018-12-31 1,408.26 683.60 142.94
2018-09-30 1,361.43 746.84 223.58
2018-06-30 1,340.33 852.74 184.02
2018-03-31 1,313.07 788.69 164.70
2017-12-31 1,303.46 843.08 197.26
2017-09-30 1,283.12 797.61 226.62
2017-06-30 1,035.12 712.18 197.08
2017-03-31 929.47 717.08 131.07
2016-12-31 901.66 702.67 158.70
2016-09-30 900.87 638.87 145.51
2016-06-30 887.55 574.80 194.98
2016-03-31 867.26 555.50 171.84
2015-12-31 850.51 576.61 141.64
2015-09-30 766.98 577.13 118.33
2015-06-30 749.96 558.62 136.24
2015-03-31 739.66 435.79 177.32
2014-12-31 726.83 418.53 170.00
2014-09-30 684.55 566.16 101.52
2014-06-30 670.60 585.59 146.71
2014-03-31 652.11 487.85 153.19
2013-12-31 634.92 527.22 168.51
2013-09-30 513.47 528.59 114.69
2013-06-30 539.29 428.05 132.93
2013-03-31 538.56 375.07 117.39
2012-12-31 552.24 376.86 146.20
2012-09-30 546.86 478.52 98.97
2012-06-30 535.68 382.71 116.05
BANK ANALYSIS

This company is a bank or financial institution, which is analysed accordingly below.

Below we check the amount of loans the bank has, how many of those are bad, and its ability to cover any bad loans.
  • First Merchants has an acceptable proportion of non-loan assets held.
  • First Merchants's liabilities are made up of primarily low risk sources of funding.
  • Loans at First Merchants are broadly funded by customer deposits.
  • First Merchants's level of assets compared to its equity is low (i.e. an appropriate level of borrowing to fund lending).
  • First Merchants has a sufficient allowance for bad loans.
  • First Merchants has an acceptable level of bad loans (less than 2%).
X
Financial health checks
We assess First Merchants's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. First Merchants has a total score of 6/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

 What is First Merchants's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
2.87%
Current annual income from First Merchants dividends. Estimated to be 2.86% next year.
If you bought $2,000 of First Merchants shares you are expected to receive $57 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • First Merchants's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.44%).
  • First Merchants's dividend is below the markets top 25% of dividend payers in United States of America (3.73%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NasdaqGS:FRME Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 7 Analyst Estimates (S&P Global) See Below
United States of America Banks Industry Average Dividend Yield Market Cap Weighted Average of 479 Stocks 2.9%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 2012 Stocks 2.4%
United States of America Minimum Threshold Dividend Yield 10th Percentile 0.8%
United States of America Bottom 25% Dividend Yield 25th Percentile 1.4%
United States of America Top 25% Dividend Yield 75th Percentile 3.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NasdaqGS:FRME Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2020-12-31 1.11 6.00
2019-12-31 0.97 6.00
NasdaqGS:FRME Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2019-05-09 1.040 2.930
2019-02-05 0.880 2.282
2018-11-07 0.880 2.324
2018-08-15 0.880 1.940
2018-05-10 0.880 1.877
2018-02-09 0.720 1.686
2017-11-13 0.720 1.689
2017-08-11 0.720 1.754
2017-05-01 0.720 1.779
2017-02-10 0.600 1.507
2016-11-16 0.600 1.640
2016-08-12 0.560 2.040
2016-05-02 0.560 2.200
2016-02-10 0.440 1.885
2015-11-18 0.440 1.800
2015-08-14 0.440 1.685
2015-05-04 0.440 1.787
2015-02-26 0.320 1.377
2014-11-14 0.320 1.432
2014-08-15 0.320 1.541
2014-04-21 0.320 1.558
2014-02-14 0.200 0.931
2013-11-20 0.200 0.947
2013-08-22 0.200 1.098
2013-04-09 0.200 1.177
2013-03-04 0.120 0.785
2013-01-24 0.120 0.799
2012-08-22 0.120 0.832
2012-04-27 0.120 0.949
2012-02-21 0.040 0.343
2011-11-01 0.040 0.451
2011-08-02 0.040 0.537
2011-05-18 0.040 0.463
2011-02-23 0.040 0.463
2010-11-30 0.040 0.443
2010-08-16 0.040 0.495
2010-05-19 0.040 0.473
2010-02-01 0.040 0.577
2009-10-30 0.320 5.480
2009-07-29 0.320 4.609
2009-05-26 0.320 3.761
2009-02-25 0.920 8.509
2008-10-29 0.920 5.146
2008-07-31 0.920 4.487

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Dividends per share have been volatile in the past 10 years (annual drop of over 20%).
  • Dividends per share have increased over the past 10 years.
Current Payout to shareholders
What portion of First Merchants's earnings are paid to the shareholders as a dividend.
  • Dividends paid are well covered by earnings (3.7x coverage).
Future Payout to shareholders
  • Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.
X
Income/ dividend checks
We assess First Merchants's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 0.8%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can First Merchants afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. First Merchants has a total score of 3/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

 What is the CEO of First Merchants's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Mike Rechin
COMPENSATION $2,046,901
AGE 59
TENURE AS CEO 12.2 years
CEO Bio

Mr. Michael C. Rechin, also known as Mike has been the Chief Executive Officer and President of First Merchants Corporation since April 24, 2007. Mr. Rechin serves as the Chief Executive Officer of First Merchants Corporation and President of First Merchants Corporation at First Merchants Bank, National Association. He served as the Chief Operating Officer and Executive Vice President at First Merchants Corporation from November 21, 2005 to April 24, 2007. He served as an Executive Vice President of Corporate Banking for National City Bank, managing its Indiana operations from 1995 to November 2005. He began his career with BancOhio National Bank in Columbus, Ohio, in 1983 as a corporate banking trainee and joined National City upon the acquisition of BancOhio in 1984. He served various positions in the multi-national and metro-Ohio commercial banking areas of National City before assuming his current post in Indianapolis in 1995. During his tenure with National City, Rechin has had responsibility for all commercial banking activities involving commercial lending, treasury management, investment real estate and international divisions. He serves as a of First Merchants Bank. Mr. Rechin has been a Director of First Merchants Corporation since December 13, 2005. He served as a Director of St. Vincent Hospital Foundation, Indy Partnership, Inc., a member of Junior Achievement of Indianapolis Board and as co-chairman of the American Heart Association Heart Walk. He has completed numerous banking schools during his career with BancOhio and National City. As an active leader in the Indianapolis community, Mr. Rechin is a director of the United Way of Central Indiana, Arts Council of Indianapolis and Lynx Capital Corporation. Mr. Rechin is a graduate of Miami University of Ohio with a Bachelors degree in English and an MBA in finance.

CEO Compensation
  • Mike's compensation has been consistent with company performance over the past year, both up more than 20%.
  • Mike's remuneration is lower than average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the First Merchants management team in years:

12
Average Tenure
53
Average Age
  • The average tenure for the First Merchants management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

Mike Rechin

TITLE
President
COMPENSATION
$2M
AGE
59
TENURE
12.2 yrs

Mark Hardwick

TITLE
Executive VP
COMPENSATION
$1M
AGE
47
TENURE
17.2 yrs

Stephan Fluhler

TITLE
Senior VP & Chief Information Officer
COMPENSATION
$556K
AGE
49
TENURE
5.1 yrs

Mike Stewart

TITLE
Executive VP & Chief Banking Officer
COMPENSATION
$1M
AGE
52
TENURE
12.5 yrs

Nicole Weaver

TITLE
VP & Director of Corporate Administration

Brian Hunt

TITLE
Secretary & Legal Counsel
AGE
58
TENURE
1.4 yrs

Karen Evens

TITLE
VP & Director of Marketing
TENURE
14.3 yrs

Steven Harris

TITLE
Senior Vice President & Director of Human Resources
AGE
54
TENURE
2.7 yrs

Jeff Lorentson

TITLE
Senior VP & Chief Risk Officer
COMPENSATION
$165K
AGE
54
TENURE
12 yrs

Michele Kawiecki

TITLE
Senior VP & Director of Finance
AGE
45
TENURE
4.3 yrs
Board of Directors Tenure

Average tenure and age of the First Merchants board of directors in years:

10.9
Average Tenure
65
Average Age
  • The average tenure for the First Merchants board of directors is over 10 years, this suggests they are a seasoned and experienced board.
Board of Directors

Charles Schalliol

TITLE
Chairman of the Board
COMPENSATION
$151K
AGE
70
TENURE
12.2 yrs

Mike Rechin

TITLE
President
COMPENSATION
$2M
AGE
59
TENURE
13.5 yrs

Jean Wojtowicz

TITLE
Director
COMPENSATION
$115K
AGE
60
TENURE
15.4 yrs

Terry Walker

TITLE
Director
COMPENSATION
$112K
AGE
71
TENURE
12.9 yrs

Mike Becher

TITLE
Director
COMPENSATION
$114K
AGE
65
TENURE
7 yrs

Bill Hoy

TITLE
Director
COMPENSATION
$99K
AGE
69
TENURE
11.7 yrs

Patrick Sherman

TITLE
Director
COMPENSATION
$105K
AGE
70
TENURE
10.1 yrs

Gary Lehman

TITLE
Director
COMPENSATION
$99K
AGE
65
TENURE
8.1 yrs

F. Halderman

TITLE
Director
COMPENSATION
$104K
AGE
51
TENURE
5.6 yrs

Jud Fisher

TITLE
Director
COMPENSATION
$96K
AGE
48
TENURE
2.3 yrs
Who owns this company?
Recent Insider Trading
  • First Merchants individual insiders have sold more shares than they have bought in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
20. Jun 19 Sell Charles Schalliol Individual 18. Jun 19 18. Jun 19 -4,680 $36.26 $-169,697
05. Jun 19 Buy Patrick Sherman Individual 03. Jun 19 03. Jun 19 15 $33.83 $500
05. Jun 19 Buy Gary Lehman Individual 03. Jun 19 03. Jun 19 49 $33.83 $1,667
02. May 19 Buy Gary Lehman Individual 01. May 19 01. May 19 45 $36.85 $1,667
02. May 19 Buy Patrick Sherman Individual 01. May 19 01. May 19 14 $36.85 $500
02. Apr 19 Buy Patrick Sherman Individual 01. Apr 19 01. Apr 19 14 $36.99 $500
02. Apr 19 Buy Gary Lehman Individual 01. Apr 19 01. Apr 19 45 $36.99 $1,667
04. Mar 19 Buy Patrick Sherman Individual 01. Mar 19 01. Mar 19 12 $40.65 $500
04. Mar 19 Buy Gary Lehman Individual 01. Mar 19 01. Mar 19 41 $40.65 $1,667
05. Feb 19 Buy Patrick Sherman Individual 01. Feb 19 01. Feb 19 14 $37.05 $500
05. Feb 19 Buy Gary Lehman Individual 01. Feb 19 01. Feb 19 45 $37.05 $1,667
03. Jan 19 Buy Patrick Sherman Individual 02. Jan 19 02. Jan 19 15 $34.17 $500
03. Jan 19 Buy Gary Lehman Individual 02. Jan 19 02. Jan 19 49 $34.17 $1,667
21. Dec 18 Buy Terry Walker Individual 19. Dec 18 19. Dec 18 1,000 $35.12 $35,120
04. Dec 18 Buy Gary Lehman Individual 03. Dec 18 03. Dec 18 40 $41.76 $1,667
04. Dec 18 Buy Patrick Sherman Individual 03. Dec 18 03. Dec 18 12 $41.76 $500
05. Nov 18 Buy Patrick Sherman Individual 01. Nov 18 01. Nov 18 12 $41.86 $500
05. Nov 18 Buy Gary Lehman Individual 01. Nov 18 01. Nov 18 40 $41.86 $1,667
26. Oct 18 Buy Patrick Sherman Individual 01. Oct 18 01. Oct 18 11 $45.11 $500
26. Oct 18 Buy Gary Lehman Individual 01. Oct 18 01. Oct 18 37 $45.11 $1,667
26. Oct 18 Buy Patrick Sherman Individual 04. Sep 18 04. Sep 18 10 $47.95 $500
26. Oct 18 Buy Gary Lehman Individual 04. Sep 18 04. Sep 18 35 $47.95 $1,667
22. Aug 18 Sell Michael Rechin Individual 20. Aug 18 20. Aug 18 -15,000 $48.63 $-729,465
26. Oct 18 Sell Michael Marhenke Individual 20. Aug 18 21. Aug 18 -26,000 $49.21 $-1,277,692
26. Oct 18 Buy Patrick Sherman Individual 01. Aug 18 01. Aug 18 10 $48.15 $500
26. Oct 18 Buy Gary Lehman Individual 01. Aug 18 01. Aug 18 35 $48.15 $1,667
26. Oct 18 Buy Gary Lehman Individual 02. Jul 18 02. Jul 18 36 $46.72 $1,667
26. Oct 18 Buy Patrick Sherman Individual 02. Jul 18 02. Jul 18 11 $46.72 $500
X
Management checks
We assess First Merchants's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. First Merchants has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

How Does Investing In First Merchants Corporation (NASDAQ:FRME) Impact The Volatility Of Your Portfolio?

Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). … This is reasonably close to the market beta of 1, so the stock has in the past displayed similar levels of volatility to the overall market. … While history does not always repeat, this may indicate that the stock price will continue to be exposed to market risk, albeit not overly so.

Simply Wall St -

First Merchants Corporation's (NASDAQ:FRME) 2.9% Dividend Yield Looks Pretty Interesting

Dividend Growth Potential With a relatively unstable dividend, it's even more important to see if earnings per share (EPS) are growing. … Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see First Merchants has grown its earnings per share at 18% per annum over the past five years. A company paying out less than a quarter of its earnings as dividends, and growing earnings at more than 10% per annum, looks to be right in the cusp of its growth phase. At the right price, we might be interested. Conclusion Dividend investors should always want to know if a) a company's dividends are affordable, b) if there is a track record of consistent payments, and c) if the dividend is capable of growing. … Earnings growth generally bodes well for the future value of company dividend payments.

Simply Wall St -

Should You Be Worried About Insider Transactions At First Merchants Corporation (NASDAQ:FRME)?

So we'll take a look at whether insiders have been buying or selling shares in First Merchants Corporation (NASDAQ:FRME). … As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.' Check out our latest analysis for First Merchants First Merchants Insider Transactions Over The Last Year The , Michael Marhenke, made the biggest insider sale in the last 12 months. … But insiders sold 42047 shares worth US$2.1m.

Simply Wall St -

Should You Think About Buying First Merchants Corporation (NASDAQ:FRME) Now?

received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to $41.25 at one point, and dropping to the lows of $35.52. … Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price? … A question to answer is whether First Merchants's current trading price of $37.86 reflective of the actual value of the?

Simply Wall St -

Should You Worry About First Merchants Corporation's (NASDAQ:FRME) CEO Pay?

This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. … How Does Mike Rechin's Compensation Compare With Similar Sized Companies. … Our data indicates that First Merchants Corporation is worth US$1.9b, and total annual CEO compensation is US$2.0m.

Simply Wall St -

With EPS Growth And More, First Merchants (NASDAQ:FRME) Is Interesting

First Merchants's Earnings Per Share Are Growing. … One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. … You can take a look at the company's revenue and earnings growth trend, in the chart below.

Simply Wall St -

Should You Be Concerned About First Merchants Corporation’s (NASDAQ:FRME) Liquidity?

As a small-cap bank stock with a market capitalisation of US$1.8b, First Merchants Corporation’s (NASDAQ:FRME) risk and profitability are largely determined by the underlying economic growth of the US regions in which it operates. … Sufficient liquidity and low levels of leverage could place the bank in a safe place in case of unexpected macro headwinds. … Today we will be measuring First Merchants’s financial risk position by looking at three leverage and liquidity metrics.

Simply Wall St -

Should First Merchants (NASDAQ:FRME) Be Disappointed With Their 81% Profit?

For example, long term First Merchants Corporation (NASDAQ:FRME) shareholders have enjoyed a 81% share price rise over the last half decade, well in excess of the market return of around 42% (not including dividends). … During five years of share price growth, First Merchants achieved compound earnings per share (EPS) growth of 18% per year. … The EPS growth is more impressive than the yearly share price gain of 13% over the same period.

Simply Wall St -

Should You Buy First Merchants Corporation (NASDAQ:FRME) For Its Dividend?

Historically, First Merchants Corporation (NASDAQ:FRME) has paid a dividend to shareholders. … Does First Merchants tick all the boxes of a great dividend stock? … 5 questions I ask before picking a dividend stock

Simply Wall St -

4 Days Left Before First Merchants Corporation (NASDAQ:FRME) Will Be Trading Ex-Dividend

Important news for shareholders and potential investors in First Merchants Corporation (NASDAQ:FRME): The dividend payment of US$0.22 per share will be distributed to shareholders on 15 March 2019, and the stock will begin trading ex-dividend at an earlier date, 28 February 2019. … What does this mean for current shareholders and potential investors? … Whenever I am looking at a potential dividend stock investment, I always check these five metrics:?

Simply Wall St -

Company Info

Description

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 rents safe deposit facilities. The company also provides personal and corporate trust; brokerage and private wealth management; and letters of credit, repurchase agreements, and other corporate services, as well as electronic and mobile delivery channels. It operates 116 banking locations in 31 Indiana, 2 Illinois, and 2 Ohio counties. The company offers its services through electronic and mobile delivery channels. First Merchants Corporation was founded in 1982 and is headquartered in Muncie, Indiana.

Details
Name: First Merchants Corporation
FRME
Exchange: NasdaqGS
Founded: 1982
$1,802,522,050
49,669,938
Website: http://www.firstmerchants.com
Address: First Merchants Corporation
200 East Jackson Street,
Muncie,
Indiana, 47305,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NasdaqGS FRME Common Stock Nasdaq Global Select US USD 20. Jun 1989
BST FM5 Common Stock Boerse-Stuttgart DE EUR 20. Jun 1989
Number of employees
Current staff
Staff numbers
1,702
First Merchants employees.
Industry
Regional Banks
Banks
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/06/26 23:39
End of day share price update: 2019/06/26 00:00
Last estimates confirmation: 2019/06/22
Last earnings filing: 2019/05/10
Last earnings reported: 2019/03/31
Last annual earnings reported: 2018/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.