Investors in regional banking stock First Merchants are witnessing a clear split in sentiment among major institutional players. Recent regulatory filings reveal that while one prominent fund manager has significantly increased its stake, another has executed a substantial reduction. This divergence comes as the company prepares to distribute its next quarterly dividend.
A Vote of Confidence from Bridgeway
In a notable show of conviction, Bridgeway Capital Management LLC has expanded its position in First Merchants. According to the latest filings with the U.S. Securities and Exchange Commission (SEC), the fund purchased an additional 28,068 shares, boosting its holdings by 7.6%. This acquisition brings Bridgeway Capital’s total stake to approximately 397,123 shares. The move is interpreted by market observers as a bullish long-term bet on the Muncie-based financial holding company, despite ongoing volatility across the banking sector.
First Trust Advisors Scales Back Exposure
In direct contrast, data released concurrently indicates that not all institutional investors share this optimistic view. First Trust Advisors LP has sharply reduced its exposure to the bank. Reports show the fund sold 315,076 shares during the latest reporting period, slashing its position by 29.1%. Following this strategic reduction, First Trust retains a holding of 766,252 shares. The opposing actions—a purchase by Bridgeway and a sale by First Trust—highlight a lack of consensus among major financial actors regarding the stock’s near-term trajectory.
Upcoming Dividend Provides Tangible Return
Amid the mixed signals from large funds, the immediate focus for many shareholders is the forthcoming dividend payment. First Merchants is set to disburse its cash dividend next week, offering a concrete return on investment.
* Payable Date: Friday, December 19, 2025
* Dividend Amount: $0.36 per common share
* Record Date: Shareholders of record as of Friday, December 5, are eligible.
Should investors sell immediately? Or is it worth buying First Merchants?
This distribution translates to an annualized dividend of $1.44 per share. For investors weighing the conflicting institutional activity, this consistent payout remains a key factor supporting the investment case.
Market Experts Maintain a Cautious Stance
The broader market assessment of First Merchants remains guarded. Earlier this month, on December 1, researchers at Zacks Investment Research downgraded their rating on the stock from “Strong-Buy” to “Hold.” This adjustment aligns with the divergent institutional moves reported over the weekend.
The prevailing analyst consensus currently leans toward a “Hold” recommendation. This reflects a wait-and-see approach as the bank navigates the current interest rate environment and regional economic conditions. The recently reported split in institutional strategy further reinforces this neutral market posture.
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