First Merchants (NASDAQ:FRME) Releases Earnings Results, Beats Expectations By $0.07 EPS

Key Points

• EPS beat but revenue missed: First Merchants reported $1.03 EPS vs. $0.96 expected (beat by $0.07) while revenue fell short at $163.53M vs. $201.91M consensus.
• Attractive dividend: The bank paid a $0.36 quarterly dividend (annualized $1.44), representing a 3.6% yield and a 37.02% payout ratio.
• Insider sales and market view: Recent insider sales (including Eva Scurlock and VP Larry Myers) occurred even as institutional investors own ~73.9% of shares and analysts maintain a "Moderate Buy" consensus with an average target of $48.33.

First Merchants (NASDAQ:FRME - Get Free Report) released its earnings results on Wednesday. The bank reported $1.03 earnings per share for the quarter, topping analysts' consensus estimates of $0.96 by $0.07, FiscalAI reports. The firm had revenue of $163.53 million for the quarter, compared to the consensus estimate of $201.91 million. First Merchants had a net margin of 21.49% and a return on equity of 9.58%. During the same period in the prior year, the firm earned $1.00 EPS.

First Merchants Price Performance

Shares of NASDAQ:FRME opened at $40.37 on Thursday. The business has a fifty day moving average price of $39.45 and a 200-day moving average price of $38.32. The company has a debt-to-equity ratio of 0.35, a current ratio of 0.91 and a quick ratio of 0.90. The company has a market capitalization of $2.56 billion, a PE ratio of 10.38 and a beta of 0.88. First Merchants has a 1-year low of $34.66 and a 1-year high of $43.22.

First Merchants Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Friday, March 20th. Stockholders of record on Friday, March 6th were issued a dividend of $0.36 per share. The ex-dividend date was Friday, March 6th. This represents a $1.44 annualized dividend and a dividend yield of 3.6%. First Merchants's dividend payout ratio (DPR) is presently 37.02%.

Insider Transactions at First Merchants

In other First Merchants news, insider Eva D. Scurlock sold 3,227 shares of the firm's stock in a transaction dated Friday, February 6th. The shares were sold at an average price of $42.29, for a total transaction of $136,469.83. Following the completion of the sale, the insider directly owned 20,063 shares in the company, valued at approximately $848,464.27. This trade represents a 13.86% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, VP Larry W. Myers sold 5,000 shares of First Merchants stock in a transaction dated Thursday, February 26th. The stock was sold at an average price of $41.50, for a total transaction of $207,500.00. Following the completion of the transaction, the vice president directly owned 109,491 shares of the company's stock, valued at $4,543,876.50. This trade represents a 4.37% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders own 1.77% of the company's stock.

Institutional Investors Weigh In On First Merchants

Institutional investors have recently made changes to their positions in the company. FJ Capital Management LLC purchased a new position in First Merchants in the 3rd quarter worth approximately $11,111,000. Hotchkis & Wiley Capital Management LLC boosted its stake in First Merchants by 252.0% during the 3rd quarter. Hotchkis & Wiley Capital Management LLC now owns 321,550 shares of the bank's stock valued at $12,122,000 after purchasing an additional 230,192 shares during the last quarter. Qube Research & Technologies Ltd increased its holdings in shares of First Merchants by 169.3% in the 2nd quarter. Qube Research & Technologies Ltd now owns 261,904 shares of the bank's stock worth $10,031,000 after purchasing an additional 164,664 shares in the last quarter. Millennium Management LLC increased its holdings in shares of First Merchants by 163.8% in the 3rd quarter. Millennium Management LLC now owns 233,264 shares of the bank's stock worth $8,794,000 after purchasing an additional 144,833 shares in the last quarter. Finally, Nuveen LLC raised its stake in shares of First Merchants by 10.9% in the fourth quarter. Nuveen LLC now owns 1,058,247 shares of the bank's stock worth $39,663,000 after purchasing an additional 104,260 shares during the last quarter. Hedge funds and other institutional investors own 73.92% of the company's stock.

Analyst Upgrades and Downgrades

Several equities research analysts recently commented on FRME shares. Weiss Ratings raised shares of First Merchants from a "hold (c+)" rating to a "buy (b-)" rating in a research note on Thursday, April 2nd. Piper Sandler raised their target price on shares of First Merchants from $46.00 to $49.00 and gave the company an "overweight" rating in a research note on Wednesday, February 4th. Three analysts have rated the stock with a Buy rating and three have assigned a Hold rating to the company. According to MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and an average target price of $48.33.

About First Merchants

First Merchants Corporation, through its subsidiary First Merchants Bank, offers a comprehensive suite of banking and financial services to individuals, businesses and public sector clients. The company's core business activities include retail and commercial banking, lending, treasury and cash management, and wealth advisory services. With a focus on relationship banking, First Merchants seeks to deliver tailored solutions for deposit accounts, loan financing and other credit products.

On the consumer side, First Merchants provides checking and savings accounts, certificates of deposit, personal and mortgage loans, and electronic banking conveniences.