First Merchants Corporation (NASDAQ:FRME) Positioned For Near-Term Integration-Driven Momentum

First Merchants enters a near-term phase defined by integration activity and mixed technical signals; fundamentals show earnings beat but elevated valuation ratios versus selective peer measures. Expect consolidation of recent deal gains to shape price action.

Recent News

On February 2, 2026 First Merchants completed the legal closing of its merger with First Savings Financial Group, effective February 1, 2026, and confirmed regulatory approvals required to close the transaction. In February the company announced changes to its board and declared a cash dividend tied to the period surrounding the transaction; management expects system integration during the second quarter of 2026.

Technical Analysis

Directional indicators (ADX / DI+ / DI-): ADX at 13.95 signals no established trend, limiting conviction for sustained breakout moves. DI+ shows a dip-and-reversal, which reads bullish for near-term directional bias, while DI- has increased, which reads bearish; the coexistence of both directional moves suggests choppy, range-bound behavior until trend strength picks up.

MACD: MACD sits at 0.30 below its signal line at 0.37 with a decreasing MACD trend, signaling waning bullish momentum and implying a near-term bias toward consolidation or modest downward pressure relative to recent levels.

MRO (Momentum/Regression Oscillator): MRO at 25.73 and rising indicates price sits above the model target and carries potential for mean reversion, increasing the probability of corrective pressure into the near term unless offset by fresh bullish catalysts.

RSI and short-term EMAs: RSI at 53.6 with a dip-and-reversal points to regained buying interest from a shallow pullback, while the 12-day EMA shows a dip-and-reversal and price (close $40.44) sits marginally above the 20-day average ($40.43) and the 50-day average ($39.26). Those alignments favor contained upside but not a broad breakout given ADX weakness.

Support, resistance, and volatility context: Price remains inside the 1x Bollinger band range (lower ~$39.84, upper ~$41.02) and above the 200-day average ($38.67), keeping the intermediate bias constructive. SuperTrend lower at $39.26 offers a nearby technical support reference. Volume slightly exceeds its 10-day average, suggesting engagement during recent sessions without surge-level conviction.

 


Fundamental Analysis

Earnings and guidance context: Reported EPS of $1.03 versus an estimate of $0.97 produced an EPS surprise of +6.19% on the quarter ended 2026-03-31 (report date 2026-04-22). Forward EPS stands at $1.13875 with a forward P/E of 34.02, reflecting expected near-term earnings carry into the next twelve months.

Profitability and cash flow: Cash flow to earnings registers at $0.00 in the supplied metrics; cost of debt sits at 10.011% and invested capital shows a negative $782,036,000 in the dataset provided. Reported earnings growth on the latest read shows mixed periodic performance: earnings growth QoQ of -6.05% and earnings growth YoY of -78.46%.

Top-line growth: Revenue growth registers at 3.63% overall, with revenue growth QoQ of 2.27% and revenue growth YoY of 78.72%; the material YoY uplift aligns with recent merger activity adding scale and one-time compounding to reported revenue comparisons.

Valuation metrics vs. industry peer metrics: Trailing P/E stands at 38.15, below the industry peer mean of 49.17 but above the industry peer median of 32.66 — the stock trades between peer median and peer mean. PEG sits at 7.48, which lies above the industry peer mean of -8.89 and above the industry peer median of -26.12, reflecting elevated price relative to measured growth. Forward P/E of 34.02 compares below the industry peer mean forward P/E of 41.70 and above the industry peer median forward P/E of 30.10. Do not interpret beyond those comparisons; these figures indicate the market assigns premium multiple characteristics relative to some peer central measures while remaining below the peer mean on a trailing basis.

WMDST valuation conclusion: The current valuation as determined by WMDST: fair-valued, with deal-related revenue lift and an EPS beat offset by elevated trailing multiples relative to industry peer mean metrics.

MOST-RECENT QUARTERLY REPORT
REPORT PERIOD ENDING: 2026-03-31
REPORT DATE: 2026-04-22
NEXT REPORT DATE: 2026-07-22
CASH FLOW  Begin Period Cash Flow
 Operating Cash Flow
 Capital Expenditures
 Change In Working Capital
 Dividends Paid
 Cash Flow Delta
 End Period Cash Flow
 
INCOME STATEMENT REVENUE
 Total Revenue
 Forward Revenue
COSTS
 Cost Of Revenue
 Depreciation
 Depreciation and Amortization
 Research and Development
 Total Operating Expenses
PROFITABILITY
 Gross Profit
 EBITDA
 EBIT
 Operating Income
 Interest Income
 Interest Expense
 Net Interest Income
 Income Before Tax
 Tax Provision
 Tax Rate
 Net Income
 Net Income From Continuing Operations
EARNINGS
 EPS Estimate 0.97
 EPS Actual 1.03
 EPS Difference 0.06
 EPS Surprise 6.186 %
 Forward EPS 1.14
 
BALANCE SHEET ASSETS
 Total Assets
 Intangible Assets
 Net Tangible Assets
 Total Current Assets
 Cash and Short-Term Investments
 Cash
 Net Receivables
 Inventory
 Long-Term Investments
LIABILITIES
 Accounts Payable
 Short-Term Debt
 Total Current Liabilities
 Net Debt
 Total Debt
 Total Liabilities
EQUITY
 Total Equity
 Retained Earnings
VALUATION & PER-SHARE METRICS EQUITY & PER-SHARE METRICS
 Book Value Per-Share
 Shares Outstanding
 Revenue Per-Share
VALUATION
 Market Capitalization
 Enterprise Value
 Enterprise Multiple
Enterprise Multiple QoQ
Enterprise Multiple YoY
Enterprise Multiple IPRWA
 EV/R
CAPITAL STRUCTURE
 Asset To Equity
 Asset To Liability
 Debt To Capital
 Debt To Assets
Debt To Assets QoQ
Debt To Assets YoY
Debt To Assets IPRWA
 Debt To Equity
Debt To Equity QoQ
Debt To Equity YoY
Debt To Equity IPRWA
PRICE-BASED VALUATION
 Price To Book (P/B)
Price To Book QoQ
Price To Book YoY
Price To Book IPRWA
 Price To Earnings (P/E) 38.148
Price To Earnings QoQ -1.25 %
Price To Earnings YoY -8.382 %
Price To Earnings IPRWA high: 85.229
mean: 49.17
FRME: 38.148
median: 32.656
low: 28.296
 PE/G Ratio 7.477
 Price To Sales (P/S)
Price To Sales QoQ
Price To Sales YoY
Price To Sales IPRWA
FORWARD MULTIPLES
Forward P/E 34.021
Forward PE/G 6.668
Forward P/S
EFFICIENCY OPERATIONAL
 Operating Leverage
ASSET & SALES
 Asset Turnover Ratio
Asset Turnover Ratio QoQ
Asset Turnover Ratio YoY
Asset Turnover Ratio IPRWA
 Receivables Turnover
Receivables Turnover Ratio QoQ
Receivables Turnover Ratio YoY
Receivables Turnover Ratio IPRWA
 Inventory Turnover
Inventory Turnover Ratio QoQ
Inventory Turnover Ratio YoY
Inventory Turnover Ratio IPRWA
 Days Sales Outstanding (DSO)
CASH CYCLE
 Cash Conversion Cycle Days (CCC)
Cash Conversion Cycle Days QoQ
Cash Conversion Cycle Days YoY
Cash Conversion Cycle Days IPRWA
CAPITAL DEPLOYMENT
 Cash Conversion Ratio
 CapEx To Revenue
 CapEx To Depreciation
 
CAPITAL, LIQUIDITY & COVERAGE CAPITAL STRUCTURE
 Total Capital
 Net Invested Capital
 Invested Capital -782.04 M
 Net Tangible Assets
 Net Working Capital
LIQUIDITY
 Cash Ratio
 Current Ratio
Current Ratio QoQ
Current Ratio YoY
Current Ratio IPRWA
 Quick Ratio
Quick Ratio QoQ
Quick Ratio YoY
Quick Ratio IPRWA
COVERAGE & LEVERAGE
 Debt To EBITDA
 Cost Of Debt 10.011 %
 Interest Coverage Ratio
Interest Coverage Ratio QoQ
Interest Coverage Ratio YoY
Interest Coverage Ratio IPRWA
 Operating Cash Flow Ratio
TIMING / LIQUIDITY
 Days Payables Outstanding (DPO)
DIVIDENDS
 Dividend Coverage Ratio
 Dividend Payout Ratio
 Dividend Rate
 Dividend Yield
PERFORMANCE GROWTH
 Asset Growth Rate
 Revenue Growth 3.628 %
Revenue Growth QoQ 226.553 %
Revenue Growth YoY 78.719 %
Revenue Growth IPRWA high: 18.406 %
FRME: 3.628 %
mean: 0.087 %
median: -7.054 %
low: -11.349 %
 Earnings Growth 5.102 %
Earnings Growth QoQ -605.149 %
Earnings Growth YoY -78.458 %
Earnings Growth IPRWA high: 41.86 %
FRME: 5.102 %
mean: -5.267 %
median: -15.517 %
low: -37.349 %
MARGINS
 Gross Margin
Gross Margin QoQ
Gross Margin YoY
Gross Margin IPRWA
 EBIT Margin
EBIT Margin QoQ
EBIT Margin YoY
EBIT Margin IPRWA
 Return On Sales (ROS)
Return On Sales QoQ
Return On Sales YoY
Return On Sales IPRWA
CASH FLOW
 Free Cash Flow (FCF)
 Free Cash Flow Yield
Free Cash Flow Yield QoQ
Free Cash Flow Yield YoY
Free Cash Flow Yield IPRWA
 Free Cash Growth
Free Cash Growth QoQ
Free Cash Growth YoY
Free Cash Growth IPRWA
 Free Cash To Net Income
 Cash Flow Margin
 Cash Flow To Earnings 0.0
VALUE & RETURNS
 Economic Value Added
 Return On Assets (ROA)
Return On Assets QoQ
Return On Assets YoY
Return On Assets IPRWA
 Return On Capital Employed (ROCE)
 Return On Equity (ROE)
Return On Equity QoQ
Return On Equity YoY
Return On Equity IPRWA
 DuPont ROE
 Return On Invested Capital (ROIC)
Return On Invested Capital QoQ
Return On Invested Capital YoY
Return On Invested Capital IPRWA

Six-Week Outlook

Expect consolidation around the $39–$41 area as integration headlines and quarterly follow-through determine directional conviction. Technicals show neutral-to-modest bullish tilt (price above 50- and 200-day averages, RSI recovering) but momentum measures (declining MACD, positive rising MRO) warn of potential pullbacks toward the SuperTrend support near $39.26. Short-term catalysts: integration updates and quarterly operational metrics; absent fresh positive catalysts, price likely trades in a defined range while the market digests transaction synergies and near-term earnings dynamics.

About First Merchants Corporation

First Merchants Corporation (NASDAQ:FRME) develops a comprehensive range of financial services through its subsidiary, First Merchants Bank. Established in 1893 and headquartered in Muncie, Indiana, the company maintains a strong presence across the Midwest with numerous locations in Indiana, Illinois, Ohio, and Michigan. First Merchants delivers community banking services tailored to both individual and business clients, offering a variety of deposit accounts such as time, savings, and demand deposits. The company provides an extensive selection of loan products, including consumer, commercial, agri-business, and real estate mortgage loans. In addition to traditional banking services, First Merchants extends its offerings to encompass personal and corporate trust services, brokerage, and private wealth management, ensuring a comprehensive approach to financial health. To meet the evolving demands of its customers, First Merchants integrates modern banking conveniences, including electronic and mobile delivery channels. By prioritizing financial stability and personalized service, First Merchants Corporation continues to drive growth and support community development throughout the regions it serves.



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