NASDAQ$MBWM

Mercantile Bank Corporation · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Reported strong results due to substantial increase in mortgage banking income and sustained strength in asset quality metrics.

Mercantile Bank Corporation reported a net income of $14.1 million, or $0.87 per diluted share, for the fourth quarter of 2020, compared to $13.3 million, or $0.81 per diluted share, for the same period last year. Total revenue was $46.2 million, up 20.0 percent from the prior-year fourth quarter. The increase was mainly due to increased mortgage banking income.

  • Net income increased to $14.1 million, or $0.87 per diluted share.
  • Total revenue increased by 20.0 percent to $46.2 million.
  • Net interest income increased by 2.2 percent to $31.8 million.
  • Noninterest income increased to $14.3 million, mainly due to increased mortgage banking income.

Headline financials

Total Revenue

$46.2M

Previous: $38.5M+20.0%
EPS (adj)

$0.87

Previous: $0.83+4.8%
Net interest margin

3.0%

Previous: 3.6%-17.4%
Net Income

$14.1M

Previous: $13.3M+6.0%
Operating Income

$20.3M

Previous: $15.2M+33.6%
Cash & Equivalents

$62.8M

Previous: $53.3M+18.0%
Total Assets

$4.44B

Previous: $3.63B+22.1%
Stock-Based Comp

$223K

Previous: $732K-69.5%

Revenue & EPS history

Mercantile Bank · Revenue · Quarterly

$46.2M

Q4 2020+20%vs Q4 2019
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

Mercantile Bank · $14.3M total across 1 segment · Q4 2020

  • Mortgage banking
    $14.3M+95.9%

Forward guidance

The company is focused on positioning itself to produce solid mortgage banking income in future periods and is continually exploring options to enhance other noninterest income revenue streams. Mercantile is committed to meeting growth objectives in a cost-conscious, efficient manner and continue to monitor our branch network and associated customer behaviors and preferences.

Tailwinds

  • Positioning the company to produce solid mortgage banking income in the future.
  • Continually exploring options to enhance other noninterest income revenue streams.
  • Committed to meeting growth objectives in a cost-conscious, efficient manner.
  • Monitoring the branch network and associated customer behaviors and preferences.
  • Established new Diversity, Equity, and Inclusion initiatives.

Headwinds

  • Challenges presented by the COVID-19 pandemic.
  • Weakened economic conditions.
  • Potential impacts of the COVID-19 pandemic.
  • Changes in interest rates and interest rate relationships.
  • Changes in the national and local economies.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2020

Historical avgQ4 2020

+0.8%

Avg return

Earnings day

+2.0%

Avg return

5 days after

+2.9%

Avg return

30 days after

55%

36 / 66 earnings

Positive

+15.7%

Q2 2023

Best reaction

-12.5%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-3.7%-5.0%-1.5%
Q4 2025+0.8%+1.8%+6.8%
Q3 2025+0.6%+2.1%-1.2%
Q2 2025-0.0%-0.4%+1.2%
Q1 2025+3.5%+3.9%+10.0%
Q4 2024+9.7%+11.3%+9.6%
Q3 2024+7.0%+4.6%+13.9%
Q2 2024+12.2%+8.7%-2.8%
Q1 2024-5.2%+1.7%+12.7%
Q4 2023+0.4%+3.2%+2.9%
Q3 2023+5.2%+2.1%+17.2%
Q2 2023+15.7%+14.8%+14.6%
Q1 2023-2.2%-2.5%-10.2%
Q4 2022-5.3%-4.9%-1.0%
Q3 2022+2.4%-0.1%+6.7%
Q2 2022+5.0%+4.7%+14.2%
Q1 2022+1.5%-2.7%-12.2%
Q4 2021+3.3%+1.4%-0.3%
Q3 2021+5.9%+5.6%+8.5%
Q2 2021+5.4%+5.8%+6.9%
Q1 2021-2.3%-0.6%-1.7%
Q4 2020-0.2%+2.0%+0.9%
Q3 2020+4.7%+13.5%+12.3%
Q2 2020+4.9%+6.9%+0.4%
Q1 2020-2.8%-0.4%-2.1%
Q4 2019-1.8%-4.0%-7.2%
Q3 2019+5.9%+6.1%+8.2%
Q2 2019-0.1%+0.3%-2.6%
Q1 2019+0.1%-0.9%-1.3%
Q4 2018+6.0%+6.8%+10.0%
Q3 2018-0.3%-3.5%-0.1%
Q2 2018-2.9%-2.3%-4.3%
Q1 2018+2.0%+2.5%+4.2%
Q4 2017-2.7%-2.6%-7.3%
Q3 2017+6.0%+5.2%-0.5%
Q2 2017+0.3%-0.3%-4.5%
Q1 2017+0.5%+2.8%-4.0%
Q4 2016-9.0%-10.5%-9.0%
Q3 2016+3.8%+3.5%+23.8%
Q2 2016-0.0%-0.2%+3.3%
Q1 2016+12.0%
Q4 2015-0.9%
Q3 2015-0.0%
Q2 2015-3.7%
Q1 2015+1.0%
Q4 2014-5.5%
Q3 2014-1.6%
Q2 2014-3.1%
Q1 2014-4.2%
Q4 2013+6.4%
Q3 2013+4.6%
Q2 2013+2.8%
Q1 2013+0.2%
Q1 2010-2.7%
Q4 2012+0.4%
Q3 2012-4.8%
Q2 2012-0.3%
Q1 2011+0.3%
Q1 2012+1.9%
Q4 2009-1.3%
Q4 2011-1.3%
Q4 2010-1.3%
Q3 2011+2.4%
Q3 2010+2.4%
Q2 2010-12.5%
Q2 2011-12.5%

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