Raymond James Reiterates Hold Rating for Mercantile Bank with $47.50 Average Price Target

Raymond James analyst Daniel Tamayo reiterated a Hold rating for Mercantile Bank (MBWM) with a price target of $47.50. The analyst consensus is also a Hold. Tamayo has a 5-star rating with a 63.31% success rate. Mercantile Bank reported Q1 revenue of $89.04 million and a net profit of $19.54 million.

Mercantile Bank Corporation (MBWM) reported robust earnings for the second quarter (Q2) and six months ended June 30, 2025, surpassing analyst expectations. The company's net interest income for Q2 was USD 49,479 million, up from USD 47,072 million a year ago. Net income for the quarter stood at USD 22,618 million, compared to USD 18,786 million a year ago. Basic and diluted earnings per share (EPS) from continuing operations were USD 1.39, both matching the previous year's figures [1].

For the six months, net interest income was USD 98,027 million, up from USD 94,434 million a year ago, while net income was USD 42,155 million, up from USD 40,348 million. Basic and diluted EPS for the six months were USD 2.6, up from USD 2.5 a year ago [1].

Revenue for Q2 was USD 60.94 million, a 7.4% increase from USD 56.55 million a year ago, slightly above the anticipated USD 60.02 million [2]. The company's stock price saw a premarket increase of 2.56%, reaching USD 50 from the previous close of USD 48.75 [3].

Analysts had expected earnings per share (EPS) of USD 1.24 for the quarter, but Mercantile Bank reported EPS of USD 1.39, a 12.1% beat. The mean expectation of five analysts was for earnings of USD 1.24 per share, with Wall Street expecting results to range from USD 1.20 to USD 1.31 per share [2].

Raymond James analyst Daniel Tamayo reiterated a Hold rating for Mercantile Bank with a price target of USD 47.50, aligning with the analyst consensus. Tamayo has a 5-star rating with a 63.31% success rate [3]. Mercantile Bank reported Q1 revenue of USD 89.04 million and a net profit of USD 19.54 million [3].

The company's strategic partnership with Eastern Michigan Bank, announced this morning, is expected to yield USD 5.5 million in cost savings, enhancing its financial position. CEO Ray Reitzna expressed optimism about the partnership, stating, "We have waited for more than a decade since our last M&A activity for a partner like Eastern Michigan to come along and our patience has been rewarded" [3].

Mercantile Bank projects continued growth, with loan growth expectations of 1-2% in Q3 2025 and 3-5% in Q4 2025. The bank anticipates a net interest margin of 3.5-3.6% in Q3 and 3.55-3.65% in Q4. Economic uncertainty, integration risks, regulatory changes, and interest rate sensitivity are among the risks and challenges the company faces [3].

References:
[1] https://www.marketscreener.com/news/mercantile-bank-corporation-reports-earnings-results-for-the-second-quarter-and-six-months-ended-jun-ce7c5cdcd18ff021
[2] https://www.tradingview.com/news/reuters.com,2025:newsml_L8N3TJ17B:0-mercantile-bank-corp-reports-results-for-the-quarter-ended-june-30-earnings-summary/
[3] https://www.investing.com/news/transcripts/earnings-call-transcript-mercantile-bank-beats-q2-2025-earnings-forecast-93CH-4146489