Piper Sandler Reiterates First Merchants (FRME) as 2025 Top Pick

Piper Sandler analyst Nathan Race reiterated an Overweight rating and $55.00 price target on First Merchants (NASDAQ: FRME). The stock has also been reiterated as a Top Pick for 2025.

The analyst commented: "We reiterate FRME as our 2025 top pick with additional outperformance expected this year (FRME +4.4% YTD vs. NASDAQ BANK Index -3.3%) driven by FRME's strong operating leverage outlook with both solid organic B/S and core fee income growth, at least NIM stability, minimal operating expense increases as well as likely benign credit quality. We view FRME's still discounted current valuation (of 10.5x/10.0x our 2025E/26E EPS and 1.6x TBV vs. peers at 11.9x/10.9x and 1.8x) as an attractive entry point, and believe FRME's multiples will likely expand in-line with, if not above, peers. FRME's building excess capital flexibility may also support additional proactive returns to shareholders via buybacks. Lastly, we do not view M&A (assuming FRME as the acquirer) as a material risk given mgmt.'s highly selective appetite. Overall, our recent discussion with mgmt. reinforced our conviction that FRME is among the best positioned to outperform this year."

For an analyst ratings summary and ratings history on First Merchants click here. For more ratings news on First Merchants click here.

Shares of First Merchants closed at $41.63 yesterday.

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