Mercantile Bank Corporation
Mercantile Bank Corporation Fundamental Analysis
Mercantile Bank Corporation (MBWM) shows moderate financial fundamentals with a PE ratio of 9.65, profit margin of 24.96%, and ROE of 13.36%. The company generates $0.4B in annual revenue with weak year-over-year growth of 2.74%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 52.1/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze MBWM's fundamental strength across five key dimensions:
Efficiency Score
WeakMBWM struggles to generate sufficient returns from assets.
Valuation Score
ModerateMBWM shows balanced valuation metrics.
Growth Score
ModerateMBWM shows steady but slowing expansion.
Financial Health Score
ModerateMBWM shows balanced financial health with some risks.
Profitability Score
ModerateMBWM maintains healthy but balanced margins.
Key Financial Metrics
Is MBWM Expensive or Cheap?
P/E Ratio
MBWM trades at 9.65 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, MBWM's PEG of 4.79 indicates potential overvaluation.
Price to Book
The market values Mercantile Bank Corporation at 1.20 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 11.59 times EBITDA. This signals the market has high growth expectations.
How Well Does MBWM Make Money?
Net Profit Margin
For every $100 in sales, Mercantile Bank Corporation keeps $24.96 as profit after all expenses.
Operating Margin
Core operations generate 21.20 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $13.36 in profit for every $100 of shareholder equity.
ROA
Mercantile Bank Corporation generates $1.32 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Mercantile Bank Corporation generates limited operating cash flow of $18.01M, signaling weaker underlying cash strength.
Free Cash Flow
Mercantile Bank Corporation produces free cash flow of $11.23M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.65 in free cash annually.
FCF Yield
MBWM converts 1.26% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
9.65
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
4.79
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.20
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.41
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.00
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.00
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.13
vs 25 benchmark
ROA
Return on assets percentage
0.01
vs 25 benchmark
ROCE
Return on capital employed
0.01
vs 25 benchmark
How MBWM Stacks Against Its Sector Peers
| Metric | MBWM Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 9.65 | 19.05 | Better (Cheaper) |
| ROE | 13.36% | 820.00% | Weak |
| Net Margin | 24.96% | 1618.00% | Weak |
| Debt/Equity | 0.00 | 1.00 | Strong (Low Leverage) |
| Current Ratio | 0.00 | 657.68 | Weak Liquidity |
| ROA | 1.32% | -24974.00% (disorted) | Weak |
MBWM outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Mercantile Bank Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
92.22%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
101.15%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
-52.53%
Industry Style: Value, Dividend, Cyclical
Declining