Critical Comparison: Virginia National Bankshares (NASDAQ:VABK) vs. Ames National (NASDAQ:ATLO)

Insider and Institutional Ownership

26.5% of Ames National shares are owned by institutional investors. Comparatively, 37.4% of Virginia National Bankshares shares are owned by institutional investors. 3.2% of Ames National shares are owned by company insiders. Comparatively, 13.9% of Virginia National Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Ames National and Virginia National Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ames National	11.05%	5.94%	0.48%
Virginia National Bankshares	20.32%	10.77%	1.06%

Dividends

Ames National pays an annual dividend of $0.80 per share and has a dividend yield of 4.3%. Virginia National Bankshares pays an annual dividend of $1.32 per share and has a dividend yield of 3.7%. Ames National pays out 70.2% of its earnings in the form of a dividend. Virginia National Bankshares pays out 41.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Earnings and Valuation

This table compares Ames National and Virginia National Bankshares”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ames National	$54.81 million	3.05	$10.22 million	$1.14	16.30
Virginia National Bankshares	$53.06 million	3.63	$16.97 million	$3.15	11.39

Virginia National Bankshares has lower revenue, but higher earnings than Ames National. Virginia National Bankshares is trading at a lower price-to-earnings ratio than Ames National, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Ames National has a beta of 0.57, indicating that its stock price is 43% less volatile than the S&P 500. Comparatively, Virginia National Bankshares has a beta of 0.46, indicating that its stock price is 54% less volatile than the S&P 500.

Summary

Virginia National Bankshares beats Ames National on 9 of the 13 factors compared between the two stocks.

About Ames National

Ames National Corporation operates as a multi-bank holding company that provides banking products and services primarily in Boone, Clarke, Hancock, Marshall, Polk, Story, and Union counties in central, north central, and south-central Iowa. The company accepts various deposit products, including checking and savings accounts; and time deposits, such as money market accounts and certificates of deposit. It also provides loans, such as short-term and medium-term commercial and agricultural real estate, residential real estate loans, equipment, vehicle, and home improvement loans; consumer loans to finance consumer purchases, such as automobiles, trucks, recreational vehicles, household furnishings, boats, personal loans, and lines of credit; agricultural and business operating loans and lines of credit; and originates mortgage loans for sale into the secondary market. In addition, the company offers cash management, merchant credit card processing, safe deposit box, wire transfer, direct deposit, and automated/video teller machine access services; and automatic drafts for various accounts, as well as wealth management services. Further, it provides farm management, investment, and custodial services for individuals, businesses, and non-profit organizations; and online, mobile, and private banking services. Ames National Corporation was incorporated in 1903 and is headquartered in Ames, Iowa.

About Virginia National Bankshares

Virginia National Bankshares Corporation operates as the holding company for Virginia National Bank that provides a range of commercial and retail banking services. The company operates through Bank, Sturman Wealth Advisors, VNB Trust and Estate Services, and Masonry Capital segments. It provides checking accounts, demand deposits, NOW accounts, money market deposit accounts, time deposits, certificates of deposit, individual retirement accounts, and other depository services. In addition, the company offers commercial and industrial loans, real estate construction and land loans, commercial real estate loans, and 1-4 family residential mortgages, as well as consumer loans comprising student loans, revolving credit, and other fixed payment loans. Further, it provides automated teller machines, internet banking, treasury, and cash management services; merchant and debit card services; and wealth and investment advisory, and brokerage services. Additionally, the company offers investment management, corporate trustee, trust and estate administration, IRA administration, house investment management, and custody services. It serves individuals, businesses, and charitable organizations in the Charlottesville/Albemarle County, Fauquier County, Manassas, Prince William County, Richmond, and Winchester market areas in Virginia. Virginia National Bankshares Corporation was founded in 1998 and is headquartered in Charlottesville, Virginia.