MBWM Fundamental Analysis - MERCANTILE BANK CORP

Fundamental Rating

We assign a fundamental rating of 4 out of 10 to MBWM. MBWM was compared to 392 industry peers in the Banks industry. While MBWM is still in line with the averages on profitability rating, there are concerns on its financial health. MBWM has a correct valuation and a medium growth rate.

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1. Profitability

1.1 Basic Checks

MBWM had positive earnings in the past year.

MBWM had a positive operating cash flow in the past year.

In the past 5 years MBWM has always been profitable.

Each year in the past 5 years MBWM had a positive operating cash flow.

1.2 Ratios

MBWM has a better Return On Assets (1.32%) than 84.69% of its industry peers.

The Return On Equity of MBWM (12.89%) is better than 85.97% of its industry peers.

		Industry Rank	Sector Rank
ROA	1.32%
ROE	12.89%
ROIC	N/A

ROA(3y)1.37%

ROA(5y)1.24%

ROE(3y)14.4%

ROE(5y)13.22%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

With an excellent Profit Margin value of 34.68%, MBWM belongs to the best of the industry, outperforming 91.58% of the companies in the same industry.

In the last couple of years the Profit Margin of MBWM has remained more or less at the same level.

MBWM does not have Operating Margin and Gross Margin available, so we won't be analyzing them here.

		Industry Rank	Sector Rank
OM	N/A
PM (TTM)	34.68%
GM	N/A

OM growth 3YN/A

OM growth 5YN/A

PM growth 3Y1.67%

PM growth 5Y1.03%

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

MBWM does not have a ROIC to compare to the WACC, probably because it is not profitable.

The number of shares outstanding for MBWM remains at a similar level compared to 1 year ago.

The number of shares outstanding for MBWM has been reduced compared to 5 years ago.

MBWM has a better debt/assets ratio than last year.

2.2 Solvency

The Debt to FCF ratio of MBWM is 12.40, which is on the high side as it means it would take MBWM, 12.40 years of fcf income to pay off all of its debts.

The Debt to FCF ratio of MBWM (12.40) is worse than 79.59% of its industry peers.

MBWM has a Debt/Equity ratio of 0.61. This is a neutral value indicating MBWM is somewhat dependend on debt financing.

MBWM has a Debt to Equity ratio of 0.61. This is in the lower half of the industry: MBWM underperforms 78.83% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.61
Debt/FCF	12.4
Altman-Z	N/A

ROIC/WACCN/A

WACC12.42%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

The earnings per share for MBWM have decreased by -0.40% in the last year.

Measured over the past years, MBWM shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.29% on average per year.

MBWM shows a small growth in Revenue. In the last year, the Revenue has grown by 1.97%.

The Revenue has been growing by 8.85% on average over the past years. This is quite good.

EPS 1Y (TTM)-0.4%

EPS 3Y9.21%

EPS 5Y11.29%

EPS Q2Q%18.8%

Revenue 1Y (TTM)1.97%

Revenue growth 3Y8.68%

Revenue growth 5Y8.85%

Sales Q2Q%7.38%

3.2 Future

Based on estimates for the next years, MBWM will show a small growth in Earnings Per Share. The EPS will grow by 4.55% on average per year.

MBWM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.63% yearly.

EPS Next Y6.58%

EPS Next 2Y6.18%

EPS Next 3Y4.55%

EPS Next 5YN/A

Revenue Next Year5.49%

Revenue Next 2Y8.66%

Revenue Next 3Y6.63%

Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

Based on the Price/Earnings ratio of 8.90, the valuation of MBWM can be described as reasonable.

MBWM's Price/Earnings ratio is rather cheap when compared to the industry. MBWM is cheaper than 88.27% of the companies in the same industry.

MBWM is valuated cheaply when we compare the Price/Earnings ratio to 27.86, which is the current average of the S&P500 Index.

Based on the Price/Forward Earnings ratio of 8.04, the valuation of MBWM can be described as reasonable.

MBWM's Price/Forward Earnings ratio is rather cheap when compared to the industry. MBWM is cheaper than 82.14% of the companies in the same industry.

MBWM's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 23.29.

		Industry Rank	Sector Rank
PE	8.9
Fwd PE	8.04

4.2 Price Multiples

Compared to the rest of the industry, the Price/Free Cash Flow ratio of MBWM indicates a slightly more expensive valuation: MBWM is more expensive than 73.21% of the companies listed in the same industry.

		Industry Rank	Sector Rank
P/FCF	23.59
EV/EBITDA	N/A

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.

PEG (NY)1.35

PEG (5Y)0.79

EPS Next 2Y6.18%

EPS Next 3Y4.55%

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5. Dividend

5.1 Amount

MBWM has a Yearly Dividend Yield of 3.30%. Purely for dividend investing, there may be better candidates out there.

Compared to an average industry Dividend Yield of 3.52, MBWM has a dividend in line with its industry peers.

Compared to an average S&P500 Dividend Yield of 2.41, MBWM pays a bit more dividend than the S&P500 average.

		Industry Rank	Sector Rank
Dividend Yield	3.3%

5.2 History

The dividend of MBWM is nicely growing with an annual growth rate of 6.02%!

MBWM has been paying a dividend for at least 10 years, so it has a reliable track record.

MBWM has not decreased their dividend for at least 10 years, which is a reliable track record.

Dividend Growth(5Y)6.02%

Div Incr Years12

Div Non Decr Years12

5.3 Sustainability

28.52% of the earnings are spent on dividend by MBWM. This is a low number and sustainable payout ratio.

MBWM's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.

DP28.52%

EPS Next 2Y6.18%

EPS Next 3Y4.55%

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MERCANTILE BANK CORP

NASDAQ:MBWM (10/3/2025, 3:47:47 PM)

44.84

+0.19 (+0.43%)

Chartmill FA Rating

GICS SectorFinancials

GICS IndustryGroupBanks

GICS IndustryBanks

Earnings (Last)07-22 2025-07-22/bmo

Earnings (Next)10-21 2025-10-21/bmo

Inst Owners65.65%

Inst Owner Change0.01%

Ins Owners2.76%

Ins Owner Change1.8%

Market Cap728.65M

Analysts78.18

Price Target56.71 (26.47%)

Short Float %0.89%

Short Ratio2.36

Dividend

		Industry Rank	Sector Rank
Dividend Yield	3.3%

Yearly Dividend1.39

Dividend Growth(5Y)6.02%

DP28.52%

Div Incr Years12

Div Non Decr Years12

Ex-Date09-05 2025-09-05 (0.38)

Surprises & Revisions

EPS beat(2)2

Avg EPS beat(2)4.89%

Min EPS beat(2)0.26%

Max EPS beat(2)9.53%

EPS beat(4)4

Avg EPS beat(4)4.04%

Min EPS beat(4)0.26%

Max EPS beat(4)9.53%

EPS beat(8)6

Avg EPS beat(8)5.06%

EPS beat(12)10

Avg EPS beat(12)6.45%

EPS beat(16)12

Avg EPS beat(16)5.56%

Revenue beat(2)0

Avg Revenue beat(2)-1.32%

Min Revenue beat(2)-2.18%

Max Revenue beat(2)-0.46%

Revenue beat(4)1

Avg Revenue beat(4)-0.66%

Min Revenue beat(4)-2.18%

Max Revenue beat(4)0.01%

Revenue beat(8)1

Avg Revenue beat(8)-2.38%

Revenue beat(12)5

Avg Revenue beat(12)-0.43%

Revenue beat(16)6

Avg Revenue beat(16)-0.53%

PT rev (1m)0%

PT rev (3m)13.18%

EPS NQ rev (1m)0%

EPS NQ rev (3m)9.88%

EPS NY rev (1m)0%

EPS NY rev (3m)5.19%

Revenue NQ rev (1m)0%

Revenue NQ rev (3m)0.35%

Revenue NY rev (1m)0%

Revenue NY rev (3m)1.35%

Valuation

		Industry Rank	Sector Rank
PE	8.9
Fwd PE	8.04
P/S	3.1
P/FCF	23.59
P/OCF	17.78
P/B	1.15
P/tB	1.25
EV/EBITDA	N/A

EPS(TTM)5.04

EY11.24%

EPS(NY)5.58

Fwd EY12.45%

FCF(TTM)1.9

FCFY4.24%

OCF(TTM)2.52

OCFY5.63%

SpS14.44

BVpS38.86

TBVpS35.82

PEG (NY)1.35

PEG (5Y)0.79

Profitability

		Industry Rank	Sector Rank
ROA	1.32%
ROE	12.89%
ROCE	N/A
ROIC	N/A
ROICexc	N/A
ROICexgc	N/A
OM	N/A
PM (TTM)	34.68%
GM	N/A
FCFM	13.16%

ROA(3y)1.37%

ROA(5y)1.24%

ROE(3y)14.4%

ROE(5y)13.22%

ROIC(3y)N/A

ROIC(5y)N/A

ROICexc(3y)N/A

ROICexc(5y)N/A

ROICexgc(3y)N/A

ROICexgc(5y)N/A

ROCE(3y)N/A

ROCE(5y)N/A

ROICexcg growth 3YN/A

ROICexcg growth 5YN/A

ROICexc growth 3YN/A

ROICexc growth 5YN/A

OM growth 3YN/A

OM growth 5YN/A

PM growth 3Y1.67%

PM growth 5Y1.03%

GM growth 3YN/A

GM growth 5YN/A

F-Score4

Asset Turnover0.04

Health

		Industry Rank	Sector Rank
Debt/Equity	0.61
Debt/FCF	12.4
Debt/EBITDA	N/A
Cap/Depr	124.84%
Cap/Sales	4.3%
Interest Coverage	N/A
Cash Conversion	N/A
Profit Quality	37.95%
Current Ratio	N/A
Quick Ratio	N/A
Altman-Z	N/A

F-Score4

WACC12.42%

ROIC/WACCN/A

Cap/Depr(3y)54.21%

Cap/Depr(5y)59.85%

Cap/Sales(3y)2.74%

Cap/Sales(5y)3.34%

Profit Quality(3y)126.85%

Profit Quality(5y)109.22%

High Growth Momentum

Growth

EPS 1Y (TTM)-0.4%

EPS 3Y9.21%

EPS 5Y11.29%

EPS Q2Q%18.8%

EPS Next Y6.58%

EPS Next 2Y6.18%

EPS Next 3Y4.55%

EPS Next 5YN/A

Revenue 1Y (TTM)1.97%

Revenue growth 3Y8.68%

Revenue growth 5Y8.85%

Sales Q2Q%7.38%

Revenue Next Year5.49%

Revenue Next 2Y8.66%

Revenue Next 3Y6.63%

Revenue Next 5YN/A

EBIT growth 1YN/A

EBIT growth 3YN/A

EBIT growth 5YN/A

EBIT Next YearN/A

EBIT Next 3YN/A

EBIT Next 5YN/A

FCF growth 1Y-69.14%

FCF growth 3Y16.21%

FCF growth 5Y24.22%

OCF growth 1Y-61.84%

OCF growth 3Y16.11%

OCF growth 5Y17.68%

MERCANTILE BANK CORP (MBWM) Stock Fundamental Analysis

1. Profitability

1.1 Basic Checks

1.2 Ratios

1.3 Margins

More info and screens

2. Health

2.1 Basic Checks

2.2 Solvency

2.3 Liquidity

More info and screens

3. Growth

3.1 Past

3.2 Future

3.3 Evolution

More info and screens

4. Valuation

4.1 Price/Earnings Ratio

4.2 Price Multiples

4.3 Compensation for Growth

More info and screens

5. Dividend

5.1 Amount

5.2 History

5.3 Sustainability

More info and screens