Positioning no disclosures inside 60 days, left as found
Options no verdict drawn today, left as found
Ethical does not pass the values gate
Price40.49 USD
Fair value51.00
Ethical score30.0/100
Our investment reviews on this name
2026-08-29Read Markdown43.23-6.3% to today ✓
2026-07-30Read Markup44.59-9.2% to today
2026-07-02Read Markdown42.09-3.8% to today ✓
Our analytic regime reads on this name, dated and marked against the screened price. Small sample per name, and separate from the daily-framework accuracy on the Track Record page.
First Merchants Corporation holds its Markdown at $40.49. Consolidating, no directional conviction, held for 268 days.
As held on the ledger · 2026-09-24
Phase
Markdown · caution
Quantitative state
Consolidating, no directional conviction, held for 268 days
Price at the screen
$40.49
Valuation
13.02 trailing · 9.02 forward price to earnings
Values screen
FAIL· score 30.0
Beta
0.85
The Workings
Five Screens, Shown in Full
Does not pass. Prohibited keyword in sector/industry: bank
Test
Figure
Limit
What it means
Status
Business activity
Excluded
Core business clean
Prohibited keyword in sector/industry: bank
Fail
Debt load
Excluded
Below 33%
Interest-bearing debt is of its assets, above the one-third ceiling the screen allows.
Fail
Interest-bearing cash
Excluded
Below 33%
Interest-bearing cash and securities are of assets, above the one-third limit.
Fail
Receivables
Excluded
Below 49%
Money owed to the company is of assets, above the 49% limit.
Fail
Revenue purity
Excluded
Below 5%
of revenue comes from non-compliant sources, over the 5% line.
Fail
Five checks adapted from AAOIFI screening standards: business activity plus four balance-sheet ratios. All five must pass for ethical clearance. Every figure is arithmetic on public accounts, not judgement.
The Ethical Read
Why It Falls Short, in Plain English
First Merchants does not clear the screen at the business-activity stage. It operates in conventional financial services, which the screen treats as interest-based, so the financial ratios are not the deciding factor here.
Read as at 2026-10-07. It updates when the underlying figures move, and past reads are kept below.
Fair value range in USD, drawn from the 2026-09-24 screen. The gold marker is the market price at the same screen. A 26.0% margin of safety to the base estimate.
Third-party analyst targets: 5 covering, consensus Buy. The average target sits +19% from the screen price.
Reading the gap · Both our model and the analysts see meaningful upside from here.
Price History & Projections
Where it has been, where the models see it going. History from market close data; projection points are our fair-value estimates and third-party analyst targets, dated to the 2026-09-24 screen.
Fair value and rating are our own model estimates; the Street's range reflects third-party analyst estimates. Analysis, not advice.
The Business, in Plain Words
Local banks handle daily needs but trigger our screen
Picture a Midwest branch where small businesses deposit Friday takings and families open their first mortgage. First Merchants runs exactly that network, yet the entire sector hits our ethical line because banks sit on the prohibited list. The numbers show a forward P/E of 9.7x, revenue down 2 percent, profit margin at 31 percent and return on equity of just 8 percent, so there is little to offset the hard stop.
We pass for that single reason. Analyst targets sit around 48 dollars against a current price of 44.59 dollars and our own fair value of 51 dollars, yet none of those figures move the ethical verdict. The opportunity rating stays at none.
Low returns on equity already flag a business that struggles to compound capital, while any cyclical slowdown in lending would compress earnings further and leave the low multiple looking like a warning rather than a bargain. Analysis, not advice.
The risks · The main risks here are ordinary market swings and the chance our fair-value read proves too optimistic.
Plain-English interpretation of our own screen data. Analysis, not advice.
Where & How to Trade
FRME trades on Nasdaq. As a listed security it is accessible through almost any international broker offering its home market. New to this, or investing from abroad? Our guide to accessing global markets covers brokers, currencies and the practical steps.
The Dated Journal · Newest First, Never Edited
Every Entry, As Written
2026-10-02Markdown$40.49-6.3%Entry 6
The framework reads markdown. Price is trending lower. Sellers are in control and the prior trend has reversed. Price has moved down 6.3% since our last review. Ethical screening: FAIL. This security does not pass our values-based screening criteria. The risk-adjusted return profile shows good risk-adjusted returns. Our composite framework grades it B, carrying a low risk profile. Technically it is holding around 6% above its long-term trend line with momentum reading neutral. Over the past year the shares are up 13%. Our forward projection puts the odds of a 10% gain over the next month near 20%. The street (5 analysts) rates it none, with a mean price target of $48.
2026-08-29Markdown · changed$43.23-3.1%Entry 5
The framework has shifted from markup to markdown since the last review. Price is trending lower. Sellers are in control and the prior trend has reversed. Price has moved down 3.1% since our last review. Ethical screening: FAIL. This security does not pass our values-based screening criteria. The risk-adjusted return profile shows good risk-adjusted returns. Our composite framework grades it B, carrying a low risk profile. Technically it is holding around 6% above its long-term trend line with momentum reading neutral. Over the past year the shares are up 13%. Our forward projection puts the odds of a 10% gain over the next month near 20%. The street (5 analysts) rates it none, with a mean price target of $48.
2026-07-30Markup · changed$44.59+5.9%Entry 4
The framework has shifted from markdown to markup since the last review. Price is trending higher with momentum. The crowd has caught on and buyers are in control. Price has moved up 5.9% since our last review. Ethical screening: FAIL. This security does not pass our values-based screening criteria. The risk-adjusted return profile shows good risk-adjusted returns. Our composite framework grades it B, carrying a low risk profile. Technically it is holding around 6% above its long-term trend line with momentum reading neutral. Over the past year the shares are up 13%. Our forward projection puts the odds of a 10% gain over the next month near 20%. The street (5 analysts) rates it none, with a mean price target of $48.
2026-07-18Markdown$42.09+0.0%Entry 3
The framework reads markdown. Price is trending lower. Sellers are in control and the prior trend has reversed. Price has moved down 0.0% since our last review. Ethical screening: FAIL. This security does not pass our values-based screening criteria. The risk-adjusted return profile shows good risk-adjusted returns. Our composite framework grades it B, carrying a low risk profile. Technically it is holding around 6% above its long-term trend line with momentum reading neutral. Over the past year the shares are up 13%. Our forward projection puts the odds of a 10% gain over the next month near 20%. The street (5 analysts) rates it none, with a mean price target of $48.
2026-07-03Markdown$42.09+0.0%Entry 2
The framework reads markdown. Price is trending lower. Sellers are in control and the prior trend has reversed. Price has moved down 0.0% since our last review. Ethical screening: FAIL. This security does not pass our values-based screening criteria. The risk-adjusted return profile shows good risk-adjusted returns.
2026-07-02Markdown$42.09Entry 1
The framework reads markdown. Price is trending lower. Sellers are in control and the prior trend has reversed. Ethical screening: FAIL. This security does not pass our values-based screening criteria. The risk-adjusted return profile shows good risk-adjusted returns.
Each entry above was written on its date, before the outcome. A journal you can prune is not a journal.
