Stock fact sheet · data as of
First Merchants Corporation (FRMEP): fair value, margin of safety and Wheel Score
Ticker symbol FRMEP · Financial Services · Banks - Regional · United States · Depositary preferred shares · Value
FRMEP is not First Merchants Corporation's common stock: it is a depositary share of its preferred stock - each one a fraction of a single preferred share. Preferred shares pay a set dividend and rank ahead of the common stock if the company fails, but usually carry no vote and do not share in the company's growth the same way. The valuation models on this page are built for common stock and say little about a preferred share. The common stock trades as FRME (common stock).
Is FRMEP undervalued?
At 24.92 (close of 5 Nov 2026), FRMEP trades 56% below the GLS average fair value of 57.11. That average comes from 9 models run on the latest filings, and 6 of them land above the current price. Margins of safety over 30% are the exception rather than the rule across the ~7,400 stocks we value each night, so the number earns First Merchants Corporation the full Value points in the Wheel Score - and a closer look at what the market is pricing in.
The 9 models disagree widely: GLS Growth gives 20.06 while Payback Time gives 113.46. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
Ranked against every other company we cover, FRMEP is clearly cheaper than it is fast-growing, so the nightly engine files it under Value (value score 70, growth score 33, out of 100).
Nine valuation models for FRMEP
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 48.65 | +95% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 54.84 | +120% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 92.85 | +273% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 39.48 | +58% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 20.06 | -19% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 102.23 | +310% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 113.46 | +355% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 21.48 | -14% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 20.92 | -16% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -148.73 | -697% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 0.0000 | -100% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Financial health is average - FRMEP passes 6 of the nine Piotroski tests, which passes the "Piotroski 6 or more" Wheel Trade Filter. The Financials tab on the Quote page shows which tests fail. The GLS Moat score is 7.2 out of 10: a record that is solid on some of the four parts the score weighs (returns on capital, pricing power, lasting growth, balance sheet) and weaker on others.
Returns on capital are moderate - ROIC 6.5%, ROE 9.2%, ROA 1.2% - with debt at 0.41 times equity and a free-cash-flow yield of 11.6%.
The dividend yield is 3.49% at a payout ratio of 47%; for a wheel trader holding assigned shares the dividend adds to the covered-call premium, and the ex-dividend date is worth knowing before a call is sold. Revenue comes mainly from Fiduciary and Trust 37%, Deposit Account 36%, Credit Card 21% (quarter Q3 FY2026).
Institutional ownership scores 5/10, insider activity 1/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 6 / 9 | ROIC | 6.5% |
|---|---|---|---|
| GLS Moat | 7.2 / 10 | ROE | 9.2% |
| Debt / equity | 0.41 | ROA | 1.2% |
| Free-cash-flow yield | 11.6% | Payout ratio | 47% |
| Institutions | 5 / 10 | Insiders · Congress | 1 · 5 / 10 |
Wheel Score 35: No options
FRMEP has no listed options in the nightly snapshot, so there is nothing to sell and the stock cannot be wheeled however good the business. It fails the first Wheel Trade Filter (options that actually trade), so the score stays under 70 and is shown as "No options" (35 here). The valuation and quality numbers still apply to owning the shares outright.
Volume runs at 0k shares a day on a market cap of $2.5B, with a beta of 0.85; the Stability part of the Wheel Score rates that fair.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Fails | no listed options |
| 2 | A real business, not a gamble | Passes | Profitable over the last twelve months - not a speculative stock, fund or note |
| 3 | Below fair value | Passes | Trading below the nine-model average fair value (margin of safety above 0) |
| 4 | Financially healthy | Passes | Piotroski F-score 6 or more out of 9 (a company with no score on file passes) |
| 5 | Can repay its debt | Passes | Long-term debt repaid from 3 years of operating cash flow or less (6 for real estate and utilities; banks and insurers are not judged on it) |
| 6 | No serious red flags | Passes | Red Flags score 60 or more out of 100 (earnings, margins, debt, analysts, filings and price checked the same way for every stock) |
| 7 | A premium worth selling | Fails | no implied volatility |
| 8 | Big enough | Passes | Market cap $1 billion or more |
| 9 | Not a penny stock | Passes | Share price $5 or more |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Strong | 56% below fair value | |
| Premium | Weak | no option data | |
| Moat | Good | moat 7.2/10 | |
| Health | Good | Piotroski 6/9 | |
| Red Flags | Fair | not scored yet - half marks | |
| Option trading | Weak | no option volume data | |
| Stability | Fair | beta 0.85, $2.5B company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 28 Jan 2027, 84 days away - outside the window of a 30-45-day put sold today.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Banks - Regional
The 12 companies below are the closest to First Merchants Corporation by market cap within the Banks - Regional industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| CLBK Columbia Financial, Inc. | 11.16 | 4.37 | -156% | 20Weak | $2.5B |
| SYBT Stock Yards Bancorp, Inc. | 81.53 | 84.45 | +3% | 38Weak | $2.5B |
| MBIN Merchants Bancorp | 53.43 | 114.03 | +53% | 52Fair | $2.5B |
| MBINL Merchants Bancorp | 23.35 | 85.98 | +73% | 33No options | $2.5B |
| MBINN Merchants Bancorp | 18.80 | 81.74 | +77% | 34No options | $2.5B |
| BUSE First Busey Corporation | 29.37 | 34.23 | +14% | 36Weak | $2.4B |
| FRME First Merchants Corporation | 41.89 | 71.06 | +41% | 50Fair | $2.6B |
| BBT Beacon Financial Corp. | 31.34 | 50.55 | +38% | 72Good | $2.6B |
| BANR Banner Corporation | 71.91 | 59.98 | -20% | 30Weak | $2.6B |
| TRMK Trustmark Corporation | 45.63 | 76.39 | +40% | 48Weak | $2.6B |
| MBINM Merchants Bancorp | 25.06 | 87.58 | +71% | 34No options | $2.4B |
| NWBI Northwest Bancshares, Inc. | 15.84 | 15.06 | -5% | 37Weak | $2.3B |
⚖ Compare FRMEP with 7 of them All Financial Services stocks →
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Start free See the Sunday ScanQuestions about FRMEP
Is FRMEP the same as First Merchants Corporation stock?
No. FRMEP is not First Merchants Corporation's common stock: it is a depositary share of its preferred stock - each one a fraction of a single preferred share. Preferred shares pay a set dividend and rank ahead of the common stock if the company fails, but usually carry no vote and do not share in the company's growth the same way. The valuation models on this page are built for common stock and say little about a preferred share. The common stock trades as FRME (common stock).
Is FRMEP undervalued right now?
By the GLS models, yes: at 24.92 the stock is 56% below the average fair value of 57.11 (data as of 5 Nov 2026). Whether the discount is deserved is the question to research next.
What is the Wheel Score of FRMEP and what does it mean?
FRMEP has no listed options in our nightly snapshot, so it cannot be wheeled; it fails the first Wheel Trade Filter (options that actually trade), stays under 70 and is shown as "No options".
What is the GLS fair value for FRMEP?
57.11 per share as of 5 Nov 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does First Merchants Corporation report earnings next?
The next earnings report is due on 28 Jan 2027, 84 days from the data date of 5 Nov 2026. The Calendars page lists every upcoming report with its time of day.
Does FRMEP have listed options, and how liquid are they?
No. The nightly options snapshot found no listed contracts on FRMEP, so the wheel strategy cannot be run on it and the Wheel Score stays under 70.