Financial Survey: International Bancshares (NASDAQ:IBOC) & Ames National (NASDAQ:ATLO)

Ames National (NASDAQ:ATLO) and International Bancshares (NASDAQ:IBOC) are both finance companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, analyst recommendations, profitability, earnings and valuation.

Analyst Ratings

This is a breakdown of current ratings for Ames National and International Bancshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ames National	0	2	1	0	2.33
International Bancshares	0	0	1	0	3.00

Ames National presently has a consensus price target of $31.00, suggesting a potential downside of 4.47%. International Bancshares has a consensus price target of $85.00, suggesting a potential upside of 18.45%. Given International Bancshares’ stronger consensus rating and higher possible upside, analysts plainly believe International Bancshares is more favorable than Ames National.

Risk & Volatility

Ames National has a beta of 0.31, indicating that its stock price is 69% less volatile than the S&P 500. Comparatively, International Bancshares has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500.

Profitability

This table compares Ames National and International Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ames National	22.64%	11.08%	1.08%
International Bancshares	38.83%	12.67%	2.47%

Earnings & Valuation

This table compares Ames National and International Bancshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ames National	$72.56 million	3.96	$19.03 million	$2.58	12.58
International Bancshares	$1.06 billion	4.23	$412.29 million	$6.63	10.82

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

Dividends

Ames National pays an annual dividend of $0.96 per share and has a dividend yield of 3.0%. International Bancshares pays an annual dividend of $1.46 per share and has a dividend yield of 2.0%. Ames National pays out 37.2% of its earnings in the form of a dividend. International Bancshares pays out 22.0% 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. International Bancshares has increased its dividend for 16 consecutive years.

Insider & Institutional Ownership

26.5% of Ames National shares are owned by institutional investors. Comparatively, 65.9% of International Bancshares shares are owned by institutional investors. 2.3% of Ames National shares are owned by company insiders. Comparatively, 13.1% of International Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

International Bancshares beats Ames National on 14 of the 16 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 International Bancshares

International Bancshares Corporation, a financial holding company, provides commercial and retail banking services in Texas and the State of Oklahoma. It accepts checking and saving deposits; and offers commercial, real estate, personal, home improvement, automobile, and other installment and term loans. The company also provides international banking services, including letters of credit, commercial and industrial loans, and foreign exchange services. In addition, it offers other banking related services, such as credit cards, safety deposit boxes, collection, notary public, escrow, drive up and walk up facilities, and other customary banking services; and Internet banking services, as well as securities products through third party providers. The company was founded in 1966 and is headquartered in Laredo, Texas.