FRME vs WTFC

For growth investors, Wintrust Financial Corporation (WTFC) is the stronger pick with 6.

7% revenue growth year-over-year, versus -0. 3% for First Merchants Corporation (FRME). First Merchants Corporation (FRME) offers the better valuation at 10. 5x trailing P/E (11. 2x forward), making it the more compelling value choice. Analysts rate First Merchants Corporation (FRME) a "Buy" — based on 11 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, First Merchants Corporation (FRME) is the cheapest at 10.

5x versus Wintrust Financial Corporation at 13. 3x. On forward P/E, First Merchants Corporation is actually cheaper at 11. 2x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Wintrust Financial Corporation wins at 0. 59x versus First Merchants Corporation's 1. 55x — a PEG below 1. 0 traditionally signals the market is underpricing earnings growth.

Over the past 5 years, Wintrust Financial Corporation (WTFC) delivered a total return of +106.

0%, compared to -1. 5% for First Merchants Corporation (FRME). Over 10 years, the gap is even starker: WTFC returned +227. 7% versus FRME's +107. 3%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), First Merchants Corporation (FRME) is the lower-risk stock at 0.

95β versus Wintrust Financial Corporation's 1. 16β — meaning WTFC is approximately 22% more volatile than FRME relative to the S&P 500. On balance sheet safety, First Merchants Corporation (FRME) carries a lower debt/equity ratio of 41% versus 62% for Wintrust Financial Corporation — giving it more financial flexibility in a downturn.

By revenue growth (latest reported year), Wintrust Financial Corporation (WTFC) is pulling ahead at 6.

7% versus -0. 3% for First Merchants Corporation (FRME). On earnings-per-share growth, the picture is similar: First Merchants Corporation grew EPS 13. 8% year-over-year, compared to 12. 1% for Wintrust Financial Corporation. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

First Merchants Corporation (FRME) is the more profitable company, earning 21.

5% net margin versus 19. 5% for Wintrust Financial Corporation — meaning it keeps 21. 5% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: WTFC leads at 26. 4% versus 24. 7% for FRME. At the gross margin level — before operating expenses — WTFC leads at 62. 2%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, Wintrust Financial Corporation (WTFC) is the more undervalued stock at a PEG of 0. 59x versus First Merchants Corporation's 1. 55x. A PEG below 1. 0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, First Merchants Corporation (FRME) trades at 11. 2x forward P/E versus 11. 8x for Wintrust Financial Corporation — 0. 6x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for FRME: 20. 4% to $49. 00.

In this comparison, FRME (3.

5% yield) pays a dividend. WTFC does not pay a meaningful dividend and should not be held primarily for income.

For long-horizon retirement investors, First Merchants Corporation (FRME) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.

95), 3. 5% yield, +107. 3% 10Y return). Both have compounded well over 10 years (FRME: +107. 3%, WTFC: +227. 7%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Financial Services sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

FRME pays a dividend while WTFC does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.