First MerchantsFRME +1.07%60 5-Year Yield-on-Cost % is 4.72 as of Jul. 09, 2026, which is 21% above its 10-year median of 3.89. GuruFocus rates FRME with a GF Score™ of 60/100 and a GF Value™ of $40.14 (Fairly Valued). The stock has 6 warning signs investors should review. Among 1,254 Banks companies, First Merchants ranks better than 61.4% on this metric.
First Merchants's yield on cost for the quarter that ended in Mar. 2026 was 4.72.
The historical rank and industry rank for First Merchants's 5-Year Yield-on-Cost % or its related term are showing as below:
FRME'
s 5-Year Yield-on-Cost % Range Over the Past 10 Years
Min: 1.78 Med: 3.89 Max: 7.08
Current: 4.72
During the past 13 years, First Merchants's highest Yield on Cost was 7.08. The lowest was 1.78. And the median was 3.89.
FRME's 5-Year Yield-on-Cost % is ranked better than 61.4% of 1254
companies
in the Banks industry
Industry Median: 3.94
vs FRME: 4.72
First Merchants (NAS:FRME) 5-Year Yield-on-Cost % Explanation
Of course the risk here is that the company may not raise its dividends as it did before. The key is to select the companies that can consistently raise its dividends. Usually companies with long history of raising dividends tend to do so.
First Merchants 5-Year Yield-on-Cost % Related Terms
FRME vs CUBI, TRMK, WAFD: 5-Year Yield-on-Cost % Comparison
For the Banks - Regional subindustry, First Merchants's 5-Year Yield-on-Cost %, along with its competitors' market caps and 5-Year Yield-on-Cost % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
First Merchants 5-Year Yield-on-Cost % vs Banks Industry
For the Banks industry and Financial Services sector, First Merchants's 5-Year Yield-on-Cost % distribution charts can be found below:
* The bar in red indicates where First Merchants's 5-Year Yield-on-Cost % falls into.
First Merchants 5-Year Yield-on-Cost % Calculation
Dividend Yield % and dividend growth of a stock is an important factor for income investors. But if company A raises its dividend constantly faster than company B, company A's future dividend yield might be much higher than Company B's even if their yields are the same now and their stock prices do not change.
Yield on Cost assumes that you buy and the stock today, and hold it for 5 years. If the company raises it dividends at the same rate as it did over the past 5 years, the dividends investors receive annually in 5 years relative to the stock price today.
Therefore, Yield-on-Cost of First Merchants is calculated as
First Merchants (FRME) has a 5-Year Yield-on-Cost % of 4.72 as of Jul. 09, 2026. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on First Merchants and its competitors. This is 21% above median its historical median of 3.89. Over the past decade, First Merchants' 5-Year Yield-on-Cost % has ranged from 1.78 to 7.08. According to the industry distribution chart, First Merchants ranks #484 out of 1254 companies in the Banks industry, placing it in the top 38.6%.
Is First Merchants' 5-Year Yield-on-Cost % too high?
First Merchants' current 5-Year Yield-on-Cost % of 4.72 is 21% above median its 10-year median of 3.89. Over the past 10 years, this metric has ranged from a low of 1.78 to a high of 7.08. The Banks industry median 5-Year Yield-on-Cost % is 3.94. First Merchants' value of 4.72 is 19.8% above this industry median. Based on the distribution chart, First Merchants ranks #484 out of 1254 companies in the Banks industry, which is above the industry midpoint. Overall, First Merchants has a GF Score™ of 60/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does First Merchants' 5-Year Yield-on-Cost % compare to CUBI and TRMK?
According to the Banks industry distribution chart, First Merchants ranks #484 out of 1254 companies for 5-Year Yield-on-Cost %. This puts First Merchants in the upper half of its industry. The industry median 5-Year Yield-on-Cost % is 3.94. First Merchants' value of 4.72 is 19.8% above this benchmark. Historically, First Merchants' own 5-Year Yield-on-Cost % has ranged from 1.78 to 7.08 over the past decade. While the company's 10-year median is 3.89 vs. the industry median of 3.94, First Merchants has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good 5-Year Yield-on-Cost % for a Banks company?
The median 5-Year Yield-on-Cost % among Banks companies is 3.94, based on 1,254 companies in the industry. Companies in the top quartile (top 25%) have a 5-Year Yield-on-Cost % significantly above this median, while those in the bottom quartile fall well below. However, 5-Year Yield-on-Cost % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. First Merchants's current 5-Year Yield-on-Cost % of 4.72 is 19.8% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high 5-Year Yield-on-Cost % mean?
A high 5-Year Yield-on-Cost % can signal that a stock is expensive relative to its fundamentals. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on First Merchants and its competitors. For the Banks industry, the median 5-Year Yield-on-Cost % is 3.94 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. First Merchants's current 5-Year Yield-on-Cost % is 4.72, which is 21% above median its own 10-year median of 3.89. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is First Merchants stock overvalued right now?
Based on GuruFocus' analysis, First Merchants (FRME) is currently considered Fairly Valued. The stock's GF Value™ is $40.14, compared to a current price of $42.62 — trading 6.2% above its estimated fair value. The current 5-Year Yield-on-Cost % is 4.72, which is 21% above median its 10-year median of 3.89 and 19.8% above the Banks industry median of 3.94. First Merchants' overall GF Score™ is 60/100 with 6 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is 5-Year Yield-on-Cost % calculated?
5-Year Yield-on-Cost % is calculated from a company's financial statements. For First Merchants (FRME), the current 5-Year Yield-on-Cost % is 4.72 as of Jul. 09, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is First Merchants (FRME) Overvalued in 2026?
Based on GuruFocus' analysis, First Merchants stock appears to be overvalued.
The current stock price of $42.62 is trading 6.2% above its estimated GF Value™ of $40.14.
GuruFocus considers First Merchants to be Fairly Valued.
Key valuation signals for FRME:
5-Year Yield-on-Cost %: 4.72 (21% above median its 10-year median of 3.89)
GF Value™: $40.14 vs. price of $42.62 (6.2% above fair value)
Industry Position: 19.8% above the Banks median (#484 of 1254)
No single metric tells the full story. See the FRME stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
First Merchants Corp, through its subsidiaries, provides its customers with financial services delivered locally by bankers. It offers personal banking, business banking, real estate mortgage lending, cash management services, brokerage, wealth management, and insurance. The company reports in only one segment, which is community banking.
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