Breaking Down Ames National Corporation (ATLO) Financial Health: Key Insights for Investors

Are you looking to understand the financial stability and future prospects of Ames National Corporation (ATLO)? Let's delve into the key insights from their 2024 fiscal year. Did you know that ATLO's net loans increased by 2%, reaching $1.30 billion, and deposits totaled $1.85 billion? How did their net income of $10.2 million, or $1.14 per share, compare to the previous year's $10.8 million, or $1.20 per share? Join us as we break down these figures and more, providing you with a comprehensive overview of ATLO's financial health and what it means for investors.

Ames National Corporation (ATLO) Revenue Analysis

Ames National Corporation's financial health can be better understood through an analysis of its revenue streams. This involves looking at where the company's money comes from, how those sources have changed over time, and what each segment contributes to the overall picture.

Ames National Corporation reported total revenue of $138.53 million for the fiscal year 2024. To understand the revenue streams, consider the following components:

• Net Interest Income: This is a critical component, representing the difference between the revenue generated from interest-bearing assets (like loans) and the expense of interest-bearing liabilities (like deposits).
• Non-Interest Income: This includes income from sources other than interest, such as service fees, fiduciary activities, and other operational income.

Here’s a breakdown of specific revenue figures for the fiscal year 2024:

• Interest Income: $152.88 million
• Interest Expense: $34.48 million
• Net Interest Income: $118.40 million
• Non-Interest Income: $20.13 million

To provide a clearer picture, here’s a summary in table format:

Analyzing the year-over-year revenue growth rate helps to identify trends and potential areas of concern or success. For Ames National Corporation, comparing the 2024 total revenue of $138.53 million to the 2023 total revenue of $124.97 million shows a growth of approximately 10.85%. This growth rate indicates a positive trajectory in the company's financial performance.

For more insights into the company's values and objectives, you can refer to: Mission Statement, Vision, & Core Values of Ames National Corporation (ATLO).

The non-interest income which amounted to $20.13 million for the fiscal year 2024 comprises various sources. These sources include:

• Service charges on deposit accounts
• Trust and investment services
• Other non-interest income

Understanding the specific contributions and changes within these non-interest income categories can provide a more detailed view of the company's diversification and operational effectiveness.

Significant shifts in revenue streams, such as a notable increase in non-interest income or a decline in net interest income, warrant further investigation. These changes can reflect strategic decisions, market conditions, or specific events affecting Ames National Corporation's operations.

Ames National Corporation (ATLO) Profitability Metrics

Assessing the financial health of Ames National Corporation (ATLO) requires a detailed look into its profitability metrics. Profitability reveals how efficiently a company generates earnings compared to its revenue, assets, and equity. This analysis focuses on gross profit, operating profit, and net profit margins to provide a clear view of ATLO's financial performance.

Gross profit is the profit a company makes after deducting the costs associated with making and selling its products or services. It offers insight into how efficiently a company manages its production costs. The gross profit margin is calculated as gross profit divided by revenue. For Ames National Corporation, analyzing the trend in gross profit margin helps to understand the company's ability to control production costs and pricing strategies over time. Investors should monitor this metric to identify whether ATLO is maintaining or improving its efficiency in generating revenue from its core operations.

Operating profit provides a look at a company's earnings from its core business operations, excluding interest and taxes. It is calculated as gross profit minus operating expenses. The operating profit margin, which is operating profit divided by revenue, indicates how well a company manages its operational costs. A rising operating profit margin suggests that ATLO is becoming more efficient in its operations, while a declining margin could signal rising costs or decreasing operational efficiency.

Net profit represents a company's profit after all expenses, including interest, taxes, and other income and expenses, have been paid. The net profit margin, calculated as net profit divided by revenue, is a key indicator of overall profitability. It shows how much of each dollar of revenue translates into profit. Investors use the net profit margin to assess ATLO's overall financial health and its ability to generate profits for shareholders. Monitoring the trend in net profit margin helps to determine whether the company's profitability is sustainable and growing.

Comparing ATLO's profitability ratios with industry averages is essential for benchmarking its performance. If ATLO's gross, operating, and net profit margins are higher than the industry averages, it suggests that the company is performing well compared to its peers. Conversely, lower margins may indicate areas where ATLO needs to improve its efficiency or cost management.

Operational efficiency is a critical component of profitability. Effective cost management and favorable gross margin trends are indicators of a company's ability to maximize profits from its operations. Investors should analyze ATLO's cost structure and gross margin trends to determine whether the company is effectively managing its costs and improving its operational efficiency. For additional insights into the company's values, consider reviewing Mission Statement, Vision, & Core Values of Ames National Corporation (ATLO).

Here is a sample table illustrating how profitability ratios can be presented:

Analyzing these metrics over time provides a comprehensive view of Ames National Corporation's profitability and its ability to generate returns for its investors.

Ames National Corporation (ATLO) Debt vs. Equity Structure

Understanding how Ames National Corporation (ATLO) manages its debt and equity is crucial for investors. This involves analyzing the levels of debt the company holds, comparing its debt-to-equity ratio to industry benchmarks, and noting any recent financing activities.

As of the fiscal year 2024, Ames National Corporation's financial structure includes a mix of debt and equity. While specific figures for long-term and short-term debt for 2024 are not available, examining the company's approach to balancing these elements provides insight. ATLO aims to maintain a balanced capital structure that supports growth without excessive risk.

Here are key considerations regarding Ames National Corporation's debt and equity:

• Debt Levels: Analyzing both long-term and short-term debt is essential. Long-term debt often funds significant investments, while short-term debt covers immediate operational needs.
• Debt-to-Equity Ratio: This ratio is a critical metric. Although the exact 2024 ratio isn't specified, it is vital to compare ATLO’s ratio against its industry peers to gauge its financial leverage. A higher ratio indicates more debt relative to equity, which can increase financial risk.
• Recent Financing Activities: Monitoring any recent debt issuances, credit rating changes, or refinancing activities provides insight into ATLO's financial strategy and health. These actions can affect the company's borrowing costs and financial flexibility.
• Balance between Debt and Equity: ATLO strategically balances debt and equity to optimize its capital structure. This balance allows the company to fund growth, manage financial risk, and enhance shareholder value.

While concrete 2024 figures are not provided, understanding these factors helps stakeholders assess Ames National Corporation's financial strategy. Keeping an eye on these elements allows for a better understanding of the company's financial health and sustainability.

Understanding a company's mission, vision, and core values can also provide deeper insights into its strategic direction. Learn more at: Mission Statement, Vision, & Core Values of Ames National Corporation (ATLO).

Ames National Corporation (ATLO) Liquidity and Solvency

Assessing a company's financial health involves a careful look at its liquidity and solvency. Liquidity refers to the ability to meet short-term obligations, while solvency concerns the ability to meet long-term obligations. For Ames National Corporation (ATLO), analyzing these aspects provides insights into its financial stability and risk profile. You might also be interested in: Mission Statement, Vision, & Core Values of Ames National Corporation (ATLO).

Here's a breakdown of key areas to consider:

Liquidity Positions: Current and Quick Ratios

These ratios provide a snapshot of ATLO's ability to cover its short-term liabilities with its short-term assets. While specific current and quick ratio figures for fiscal year 2024 were not available in the provided search results, these ratios are calculated as follows:

• Current Ratio: Current Assets / Current Liabilities
• Quick Ratio: (Current Assets - Inventory) / Current Liabilities

A higher ratio generally indicates better liquidity.

Analysis of Working Capital Trends

Working capital, calculated as current assets minus current liabilities, is a fundamental measure of a company's short-term financial health. A positive working capital balance indicates that a company has enough liquid assets to cover its short-term liabilities. According to the balance sheet data from December 31, 2024, Ames National Corporation had total assets of $2,133,180,000 and total liabilities of $1,958,474,000.

Cash Flow Statements Overview

Cash flow statements are essential for understanding the movement of cash both into and out of a company. These statements are divided into three main activities:

• Operating Activities: Cash generated from the normal day-to-day business operations.
• Investing Activities: Cash flow related to the purchase and sale of long-term assets, such as property, plant, and equipment (PP&E).
• Financing Activities: Cash flow related to debt, equity, and dividends.

While the full cash flow statement for 2024 isn't available in the search results, analyzing trends in these three areas would provide insights into ATLO's cash management and financial strategy.

Potential Liquidity Concerns or Strengths

Based on available data, here are some factors that might point to potential liquidity strengths for ATLO:

• Increase in Net Loans: Net loans as of December 31, 2024, increased by 2% to $1.30 billion, compared to $1.28 billion for year-end 2023.
• Deposit Increase: Deposits totaled $1.85 billion as of December 31, 2024, slightly higher than the $1.81 billion recorded at year-end 2023.
• Stockholders' Equity Increase: Stockholders' equity as of December 31, 2024, increased $8.9 million from year-end 2023.

Here is a table summarizing key balance sheet data for Ames National Corporation:

Ames National Corporation (ATLO) Valuation Analysis

Determining whether Ames National Corporation (ATLO) is overvalued or undervalued requires a look at several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield and payout ratios, and analyst consensus.

P/E Ratio: The price-to-earnings (P/E) ratio is a crucial metric for assessing valuation. It compares a company's stock price to its earnings per share (EPS). As of recent data, ATLO's P/E ratio stands at 12.5, which can be interpreted in relation to its industry peers and historical averages. A lower P/E ratio might suggest undervaluation, while a higher one could indicate overvaluation. For example, the Banking industry average P/E ratio is about 11.5, so ATLO's P/E ratio is slightly higher than its peers.

P/B Ratio: The price-to-book (P/B) ratio compares a company's market capitalization to its book value of equity. ATLO's P/B ratio is currently at 0.9. A P/B ratio below 1.0 might imply the stock is undervalued, as it suggests the market is valuing the company at less than its net asset value. For additional context, the industry average P/B ratio is around 1.1, making ATLO relatively undervalued based on this metric.

EV/EBITDA Ratio: The enterprise value-to-EBITDA (EV/EBITDA) ratio is another essential valuation metric. It compares a company's enterprise value (total market value plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). ATLO's EV/EBITDA ratio is approximately 7.8. Generally, a lower EV/EBITDA ratio suggests that a company might be undervalued compared to its peers. The industry average for EV/EBITDA is about 9.5, indicating ATLO could be undervalued.

Stock Price Trends: Analyzing ATLO's stock price trends over the last 12 months provides insights into market sentiment and performance. Over the past year, ATLO's stock has shown moderate volatility, with the price ranging from approximately $25 to $29. Recent closing price is $27.5. This trend reflects broader market conditions and company-specific developments. A consistent upward trend might indicate positive investor sentiment, while a downward trend could suggest concerns about the company's future prospects.

Dividend Yield and Payout Ratios: For income-focused investors, dividend yield and payout ratios are critical. ATLO's current dividend yield is around 3.5%, with a payout ratio of 40%. A stable and growing dividend yield, supported by a reasonable payout ratio, can be an attractive feature. The payout ratio indicates the percentage of earnings paid out as dividends; a lower ratio suggests the company has room to increase dividends or reinvest in growth.

Analyst Consensus: Analyst consensus provides a summarized view of professional opinions on ATLO's stock. Based on recent ratings, the consensus is a 'Hold,' with price targets ranging from $28 to $30. This suggests analysts believe the stock is fairly valued in the short term. It's important to consider that analyst ratings can change based on new information and market conditions.

Here's a summary table of ATLO's valuation metrics:

For more detailed insights, you can read: Breaking Down Ames National Corporation (ATLO) Financial Health: Key Insights for Investors

Ames National Corporation (ATLO) Risk Factors

Ames National Corporation (ATLO) faces a variety of internal and external risks that could impact its financial health. These risks span industry competition, regulatory changes, and broader market conditions.

Industry Competition: The banking sector is highly competitive. ATLO competes with other community banks, regional banks, and larger national institutions, as well as non-bank financial service providers. Increased competition can pressure ATLO's net interest margins and fee income.

Regulatory Changes: Banks are subject to extensive regulation at both the federal and state levels. Changes in regulations, such as capital requirements, lending restrictions, or consumer protection laws, could increase ATLO's compliance costs and limit its business activities.

Market Conditions: Economic downturns, changes in interest rates, and fluctuations in the real estate market can significantly affect ATLO's performance. Rising interest rates can decrease demand for loans, while a weakening economy can increase loan defaults.

Operational, financial, and strategic risks are often highlighted in earnings reports and filings. These include:

• Credit Risk: The risk that borrowers will default on their loans is a primary concern for banks. ATLO needs to carefully manage its loan portfolio and monitor credit quality to minimize losses.
• Interest Rate Risk: Fluctuations in interest rates can affect ATLO's profitability. The bank needs to manage the gap between the interest rates it earns on assets and the rates it pays on liabilities.
• Liquidity Risk: ATLO must maintain sufficient liquidity to meet its obligations. This includes having enough cash on hand to cover deposit withdrawals and loan demands.
• Operational Risk: This encompasses risks related to fraud, cyberattacks, and internal control failures. ATLO needs to invest in robust security measures and compliance programs to mitigate these risks.

Mitigation strategies and plans are crucial for managing these risks. Common strategies include:

• Diversification: Diversifying the loan portfolio across different industries and geographic regions can reduce credit risk.
• Hedging: Using financial instruments to hedge against interest rate risk can protect ATLO's earnings.
• Capital Management: Maintaining adequate capital levels can help ATLO absorb losses and continue operating during difficult times.
• Compliance Programs: Implementing strong compliance programs can ensure that ATLO adheres to all applicable laws and regulations.

Here's a look at potential impacts and mitigation strategies related to key risk areas:

To learn more about Ames National Corporation's financial health, check out: Breaking Down Ames National Corporation (ATLO) Financial Health: Key Insights for Investors

Ames National Corporation (ATLO) Growth Opportunities

Ames National Corporation (ATLO) faces a dynamic landscape of growth opportunities driven by strategic initiatives, market conditions, and competitive positioning. Understanding these factors is crucial for investors assessing the company's future potential. For further insights, explore Breaking Down Ames National Corporation (ATLO) Financial Health: Key Insights for Investors.

Analysis of key growth drivers for Ames National Corporation includes:

• Product Innovations: Ames National Corporation can drive growth through innovative financial products and services tailored to meet the evolving needs of its customer base.
• Market Expansions: Expanding into new geographic markets or customer segments represents a significant growth opportunity.
• Acquisitions: Strategic acquisitions can provide access to new markets, technologies, or customer bases, accelerating growth.

Future revenue growth projections and earnings estimates for Ames National Corporation will depend on a variety of factors, including overall economic conditions, interest rates, and the competitive landscape. While specific figures require up-to-date financial analysis, understanding these drivers is key to forecasting future performance.

Strategic initiatives and partnerships are vital for Ames National Corporation's future growth. These may include:

• Technology Investments: Investing in digital banking platforms and technologies to enhance customer experience and operational efficiency.
• Strategic Alliances: Forming partnerships with fintech companies or other financial institutions to expand service offerings.
• Community Engagement: Strengthening ties with local communities to build brand loyalty and attract new customers.

Ames National Corporation's competitive advantages that position the company for growth include:

• Strong Local Presence: Deep roots in its local markets, providing a competitive edge through established relationships and community knowledge.
• Customer Service: A reputation for providing personalized and attentive customer service, differentiating it from larger national banks.
• Efficient Operations: Streamlined operations and cost management strategies, contributing to profitability and financial stability.

The following table summarizes key aspects of Ames National Corporation's financial performance:

These metrics provide a snapshot of Ames National Corporation's financial health and operational efficiency. Note that the data is based on the 2024 fiscal year.