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Upturn AI Summary - About
First Merchants Corporation(FRME)
Advisory History & Simulated Performance *
*as per simulation (see disclosures)- ALL
- 1Y
- 1M
- 1W
- BUY Advisory
- SELL Advisory (Profit)
- SELL Advisory (Loss)
- Profit
- Loss
- PASS (Skip)
Stock price based on last close Advisory Performance History (Simulated)
Upturn Advisory & Investor View for FRME
11/05/2026: FRME (1-star) has a low Upturn Star Rating. Not recommended to BUY.
First Merchants Corporation is a well-established regional financial institution headquartered in the Midwest, offering a comprehensive suite of commercial, retail, and wealth management services. The company has a stable business model, historically driven by consistent relationship-based banking and disciplined underwriting standards. Its primary growth strategy involves selective market expansion and digital platform modernization to better compete in an evolving industry. However, the bank faces risks related to geographic concentration, intensified competition for deposits, and sensitivity to interest rate fluctuations. It is best suited for income-oriented and value-focused investors who prioritize steady dividend returns and conservative management over high-growth volatility, provided they monitor regional economic trends.
How to Read the Upturn Advisory
The Upturn Star Rating and the current BUY, SELL, or PASS advisory are generated by Upturn’s AI advisory engine based on proprietary signal analysis, price behavior, advisory history, and historical signal performance.
Company fundamentals, valuation, risks, and news provide supporting context about the business.
Investor Fit
| Investor style | Fit | Why |
|---|---|---|
| Growth investor | Mixed fit | The company offers moderate growth rather than the aggressive expansion typical of growth-oriented portfolios. |
| Momentum investor | Weak fit | The stock tends to trade based on long-term fundamentals rather than short-term price momentum. |
| Value investor | Strong fit | The bank is often priced at reasonable multiples, appealing to those seeking stable banking assets. |
| Dividend investor | Strong fit | The company has a consistent history of paying dividends, making it suitable for income-focused investors. |
| Low-risk investor | Strong fit | The company's conservative management style and stable business model align well with low-risk objectives. |
Risk Profile
| Risk factor | Level | Why it matters |
|---|---|---|
| Price volatility | Medium | Like most regional bank stocks, FRME is subject to market sentiment regarding interest rates and economic outlooks. |
| Valuation risk | Low | The stock is generally priced in line with regional banking peers, limiting significant downside from valuation bubbles. |
| Competition risk (Banking) | Medium / high | The sector faces intense pressure from large national banks and fintech entrants that can spend more on technology. |
| Business quality | Strong | First Merchants has a long-standing reputation for disciplined credit and stable operations in its core markets. |
| Dividend income | Medium | While consistent, dividend growth is dependent on capital ratios and regulatory approval. |
| Execution risk | Medium | The bank's strategy relies on successful integration of acquisitions and effective digital adaptation. |
Price Behavior
Rolling Over
The price momentum is slowing down and beginning to turn downward.
Smooth
The stock has moved along a generally orderly path with only modest fluctuations.
Analysis of Past Performance
Type Stock | Historic Profit -18.63% | Avg. Invested days 37 | Today’s Advisory Consider higher Upturn Star rating |
Upturn Advisory Rating  | Upturn Advisory Performance  3.0 | Stock Returns Performance  1.0 |
| Profits based on simulation | Last Close 11/05/2026 |
Upturn Scorecard
Upturn Star Rating 
Company Fundamentals
Financial Health Rating
Growth Momentum Score
Ownership
Top 5 Institutional Investors
Unit Economics (Per $1K Revenue)
Economic Dimensions
Quantitative Style Profile
Style Classification
Quality Focused
Key Highlights
Company Size Mid-Cap Stock | Market Capitalization 2.63B USD | Price to earnings Ratio 13.01 | 1Y Target Price 46.33 |
Price to earnings Ratio 13.01 | 1Y Target Price 46.33 | ||
Volume (30-day avg) 475.6K shares | Beta 0.9 | 52 Weeks Range 33.40 - 44.93 | Updated Date 11/04/2026 |
52 Weeks Range 33.40 - 44.93 | Updated Date 11/04/2026 | ||
Dividends yield (FY) 3.56% | Basic EPS (TTM) 3.22 |
How Company Makes Money
| Business area | What it includes | Retail investor read |
|---|---|---|
| Net Interest Income | Interest earned on loans and securities minus interest paid on deposits. | This is the core engine of profit, driven by the spread between lending rates and deposit costs. |
| Fee-Based Services | Service charges on deposits, wealth management fees, and trust income. | These fees provide a stable, recurring revenue stream that is less sensitive to interest rate changes. |
| Midwest Geography | Banking operations primarily across Indiana, Ohio, Michigan, and Illinois. | The company's health is tied to the economic activity and loan demand in these specific regional economies. |
Analyzing Revenue: Products, Geography and Growth
Revenue by Products
Product revenue - Year on Year
Earnings Date
Report Date 2026-10-21 | When After Market | Estimate 1.04 | Actual 1.1 |
Profitability
Profit Margin 29.21% | Operating Margin (TTM) 45.03% |
Management Effectiveness
Return on Assets (TTM) 0.99% | Return on Equity (TTM) 7.82% |
Valuation
Trailing PE 13.01 | Forward PE 11.07 | Enterprise Value 3.49B | Price to Sales(TTM) 3.88 |
Enterprise Value 3.49B | Price to Sales(TTM) 3.88 | ||
Enterprise Value to Revenue 5.12 | Enterprise Value to EBITDA - | Shares Outstanding 62.68M | Shares Floating 61.44M |
Shares Outstanding 62.68M | Shares Floating 61.44M | ||
Percent Insiders 2.11 | Percent Institutions 75.24 |
Financial Metrics
🧭 Investment Snapshot
Total Revenue (Scale)
Total money earned from selling products or services before any costs. It is needed to understand the scale of the business and its ability to generate income.
Net Income (Profit)
Final profit after all expenses, interest, and taxes are deducted. It is needed to determine the overall profitability available to shareholders.
Free Cash Flow (Cash Strength)
Cash remaining after operating activities and capital expenditures, showing cash available for growth. It is needed to evaluate the company’s ability to invest, pay dividends, or reduce debt.
📈 Growth & Strength
Operating Income (Core Profit)
Profit from core operations after deducting all operating expenses. It is needed to measure how efficiently the company runs its primary business activities.
EBITDA (Cash Earnings)
Earnings before interest, taxes, depreciation, and amortization, indicating operating cash potential. It is needed to compare operating performance across companies without accounting or financing differences.
Gross Profit (Unit Profitability)
Revenue minus cost of revenue, showing profit after direct production costs. It is needed to evaluate core business profitability before overhead expenses.
🛡️ Financial Safety
Cash (Liquidity Buffer)
Total cash and cash equivalents on hand. It is needed to evaluate immediate liquidity and financial flexibility.
Total Debt (Leverage Risk)
Total debt including both short-term and long-term components. It is needed to assess the company’s leverage and financial risk.
Net Working Capital (Short-Term Health)
Current assets minus current liabilities, indicating short-term liquidity strength. It is needed to assess whether the company can meet its short-term obligations.
🧱 Balance Sheet Strength
Stockholder Equity (Net Worth)
Total equity value held by shareholders. It is needed to understand the net worth of the company from the owners’ perspective.
Total Assets (Asset Base)
The full value of everything the company owns, including cash, inventory, equipment, and investments. It is needed to understand the resource base used to generate revenue.
Income Before Tax (Pre-Tax Earnings)
Income before provision for income taxes. It is needed to analyze profitability independent of tax structures.
⚙️ Cost & Drag Factors
Cost of Revenue (Production Cost)
Direct costs required to produce and deliver the products or services sold. It is needed to assess efficiency in production and service delivery.
Total Operating Expenses (Operating Cost)
Indirect costs of running the business such as salaries, marketing, and administration. It is needed to understand how much it costs to sustain ongoing business operations.
Income Tax Expense (Tax Drag)
Amount of taxes paid or payable to the government. It is needed to evaluate the impact of taxation on overall profitability.
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