Is Merchants Bancorp (Indiana) overvalued or undervalued?

As of 12 May 2025, the valuation grade for Merchants Bancorp (Indiana) has moved from very attractive to attractive. The company is currently considered undervalued based on its financial metrics. Key ratios include a P/E ratio of 5, a Price to Book Value of 0.69, and an EV to EBIT of 0.76, which suggest that the stock is trading at a significant discount compared to its earnings and book value.
In comparison to its peers, Merchants Bancorp's P/E ratio is notably lower than Renasant Corp., which has a P/E of 16.22, and WesBanco, Inc., which stands at 23.62. This disparity highlights the potential undervaluation of Merchants Bancorp relative to its industry. Additionally, while the stock has faced challenges with a year-to-date return of -11.96%, it has outperformed the S&P 500 over the past week, indicating some resilience in its recent performance.