AMES National

ATLO

Market cap $241M

Ames National has surged 21% YTD, benefiting from widening interest rate spreads and robust net income growth. ATLO's Q4'25 net income rose 85% to $6.5 million, with ROA doubling and net interest margins improving to 3%. Deposit costs declined despite growth in deposits, while loan yields—especially real estate—rose, driving spread expansion.

Ames National offers an attractive 4.2% dividend yield, but its long-term dividend sustainability is questionable due to past cuts and volatile earnings. The bank's conservative loan-to-deposit ratio and strong capital position support short-term stability, yet growth prospects remain muted. Recent improvements in efficiency and profitability are positive, but a declining rate environment could pressure future earnings and dividends.

Ames National Grows Income in Q2

Ames National's stock price has plunged over the last six months, mostly due to a dividend cut. There is hope for an earnings revival because the fast-moving deposit costs will likely fall while the slow-moving asset yields will rise in 2025. Loan growth will likely continue at the rate seen in 2023 as the drivers are stable.