Merchants Bancorp (MBIN) AI Stock Analysis

• Market Cap: $1.99B
• Dividend Yield: 1.19%
• Average Volume (3M): 164.84K
• Price to Earnings (P/E): 11.2
• Beta (1Y): 1.05
• Revenue Growth: -2.45%
• EPS Growth: -28.20%
• Country: US
• Employees: 663
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 1.28
• Shares Outstanding: 45,962,067
• 10 Day Avg. Volume: 166,862
• 30 Day Avg. Volume: 164,845
• PEG Ratio: -0.18
• Price to Book (P/B): 0.69
• Price to Sales (P/S): 1.14
• P/FCF Ratio: -4.58
• Enterprise Value/Market Cap: 2.92
• Enterprise Value/Revenue: 4.19
• Enterprise Value/Gross Profit: 9.80
• Enterprise Value/Ebitda: 18.13
• 1Y Price Target: $48.50
• Price Target Upside: 11.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 5.02
• Revenue Forecast (FY): $725.89M

• Rating: 58 Neutral
• Price Target: $44.00 ▲(1.48% Upside)
• Action: Downgraded Date: 02/28/26
• Date: Action: Downgraded 02/28/26

The score is held back primarily by financial risks: earnings softened in 2025, leverage is elevated, and cash flow has been negative in most years. Technicals are mixed but generally supportive versus longer-term averages, while valuation is reasonable (P/E ~11.2) and the dividend increase is a modest positive.

Positive Factors

Improving asset quality

A meaningful reduction in criticized loans (‑13%) and nearly one‑third drop in NPLs materially lowers expected credit losses and provisioning needs. This improvement strengthens the bank’s capacity to extend credit, preserves capital, and lessens earnings volatility over the coming quarters.

Share repurchase program

A $100M buyback program is a durable capital allocation lever indicating management’s confidence in balance sheet capacity and excess capital. When funded prudently, repurchases can boost tangible book value and return on equity, benefiting long‑term per‑share economics.

Solid core profitability

A ~16% net margin in 2025 shows underlying earnings power in core banking activities despite headwinds. Durable margins provide a buffer for credit cycles, support internal capital generation, and help sustain dividends and reinvestment while management addresses revenue pressures.

Negative Factors

Elevated leverage

Debt‑to‑equity increasing materially to ~1.68 (peak ~1.93) meaningfully raises financial leverage. Higher gearing reduces capital flexibility, increases sensitivity to rising funding costs or credit stress, and constrains the bank’s ability to absorb further losses or pursue growth without additional capital.

Weak cash generation

Persistent negative operating and free cash flow in most recent years indicates weak cash conversion of accounting earnings. Reliance on external funding to cover cash shortfalls limits the sustainability of dividends and buybacks and reduces capacity to self‑fund loan growth or rebuild liquidity buffers.

Earnings & revenue deterioration

A drop in revenue and a sharp earnings decline (~$320M to ~$219M) represent a clear weakening trend. Sustained revenue and profit contraction pressures margins, ROE and capital accumulation, making it harder to improve leverage and maintain long‑term shareholder returns without operational fixes or balance‑sheet actions.

Merchants Bancorp Business Overview & Revenue Model

Company Description

Merchants Bancorp operates as the diversified bank holding company in the United States. The company operates through Multi-family Mortgage Banking, Mortgage Warehousing, and Banking segments. The Multi-family Mortgage Banking segment originates and services government sponsored mortgages for multi-family and healthcare facilities. This segment also offers customized loan products for independent living, assisted living, memory care, and skilled nursing projects; and operates as a syndicator of low-income housing tax credit and debt funds. The Mortgage Warehousing segment funds agency eligible residential loans, including origination, purchase, and sale in the secondary market, as well as commercial loans to non-depository financial institutions. The Banking segment offers a range of financial products and services to consumers and businesses, such as various types of deposit products, as well as multi-family construction and bridge, commercial real estate, commercial and industrial, agricultural, residential mortgage, and consumer loan products. This segment also provides single-family mortgage lending; construction, bridge, and lot financing; first-lien home equity lines of credit; and small business administration lending products and services. Merchants Bancorp was founded in 1990 and is headquartered in Carmel, Indiana.

How the Company Makes Money

Merchants Bancorp generates revenue primarily through interest income from its loan portfolio, which includes commercial loans and residential mortgages. The company earns interest from the loans it originates and holds, as well as from the servicing fees associated with mortgage loans. Additionally, MBIN generates non-interest income through various fees related to banking services, including transaction fees, service charges, and mortgage origination fees. The company's focus on mortgage banking allows it to capitalize on the refinancing and home buying activities in the housing market. Strategic partnerships with mortgage brokers and real estate professionals further enhance its ability to generate revenue. Lastly, the bank's investment in technology and digital banking services has helped to streamline operations and reduce costs, contributing positively to its earnings.

Merchants Bancorp Financial Statement Overview

Summary

Profitability is still solid (2025 net margin ~16%), but the trajectory weakened with revenue down in 2025 (-1.58%) and net income falling from ~$320M (2024) to ~$219M (2025). Balance sheet risk rose as leverage moved sharply higher (debt-to-equity ~1.68 in 2025), and the biggest concern is persistently negative operating/free cash flow in most years outside of 2022.

Income Statement

Revenue expanded strongly from 2020–2024, but slipped slightly in 2025 (annual revenue growth of -1.58%), signaling a near-term slowdown. Profitability remains solid for the period, with 2025 net margin still healthy (~16%), but margins compressed meaningfully versus 2021–2022 levels and earnings fell from 2024 to 2025 (net income down from ~$320M to ~$219M). Overall: good earnings power, but weakening trajectory and margin pressure are clear.

Balance Sheet

Leverage increased materially in recent years: debt-to-equity rose from ~0.57 (2023) to ~1.93 (2024) and remained elevated at ~1.68 (2025). Equity has grown, but the balance sheet is more geared today, reducing flexibility if credit conditions tighten. Returns on equity remain positive but have cooled (from ~14.3% in 2024 to ~9.6% in 2025), consistent with the earnings step-down and higher leverage.

Cash Flow

Cash generation is the key weakness. Operating cash flow and free cash flow were negative in most years (2020, 2021, 2023–2025), including a large outflow in 2024 and continued outflow in 2025. 2022 was an outlier with strong positive operating and free cash flow, but the return to sustained negative cash flow raises questions around the durability and timing of cash realization versus reported earnings.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.39B	1.37B	1.45B	1.19B	602.07M	461.56M
Gross Profit	593.34M	563.69M	642.69M	519.10M	422.49M	422.66M
EBITDA	320.86M	263.80M	425.66M	350.76M	293.63M	307.12M
Net Income	246.59M	218.77M	320.39M	279.23M	219.72M	227.10M
Balance Sheet
Total Assets	19.35B	19.45B	18.81B	16.95B	12.62B	11.28B
Cash, Cash Equivalents and Short-Term Investments	1.25B	880.90M	566.62M	1.70B	549.50M	1.34B
Total Debt	2.90B	3.84B	4.34B	964.13M	940.39M	1.17B
Total Liabilities	17.13B	17.17B	16.56B	15.25B	11.16B	10.12B
Stockholders Equity	2.23B	2.28B	2.24B	1.70B	1.46B	1.16B
Cash Flow
Free Cash Flow	10.33M	-341.25M	-853.67M	-363.93M	966.96M	-52.86M
Operating Cash Flow	46.67M	-341.25M	-835.28M	-356.40M	975.77M	-49.22M
Investing Cash Flow	-251.87M	-195.67M	-874.27M	-3.26B	-2.86B	-474.26M
Financing Cash Flow	201.32M	272.51M	1.60B	3.97B	1.08B	1.38B

Merchants Bancorp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 43.36
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MBIN, the sentiment is Positive. The current price of 43.36 is below the 20-day moving average (MA) of 44.38, above the 50-day MA of 38.93, and above the 200-day MA of 34.07, indicating a neutral trend. The MACD of 1.28 indicates Positive momentum. The RSI at 54.04 is Neutral, neither overbought nor oversold. The STOCH value of 20.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MBIN.

Merchants Bancorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STBA	75 Outperform	$1.57B	11.90	9.35%	3.38%	-1.48%	-1.58%
TCBK	70 Outperform	$1.57B	12.91	9.20%	2.83%	0.93%	5.65%
NBHC	68 Neutral	$1.83B	14.01	9.06%	3.07%	-2.46%	-1.98%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
GABC	66 Neutral	$1.57B	13.51	10.75%	2.89%	30.45%	3.13%
MBIN	58 Neutral	$1.99B	11.19	11.84%	1.19%	-2.45%	-28.20%
TFIN	50 Neutral	$1.36B	62.00	1.11%	―	2.04%	-64.17%

Merchants Bancorp Corporate Events

Merchants Bancorp Raises Quarterly Common Dividend Ten Percent

On February 19, 2026, Merchants Bancorp announced that its board increased the quarterly dividend on its common stock by 10% to $0.11 per share for the first quarter of 2026. The board also declared quarterly cash dividends on its Series C, Series D, and Series E preferred stock, with all dividends payable on April 1, 2026 to shareholders of record as of March 13, 2026.

The higher common dividend signals management’s confidence in the company’s financial performance and capital position, while the continued preferred payouts reinforce its commitment to returning capital across the capital structure. These actions provide predictable income to common and preferred shareholders and may enhance the stock’s appeal to income-focused investors in the banking sector.

The most recent analyst rating on (MBIN) stock is a Buy with a $46.00 price target. To see the full list of analyst forecasts on Merchants Bancorp stock, see the MBIN Stock Forecast page.