Comparing First Horizon (NYSE:FHN) and Ames National (NASDAQ:ATLO)

Ames National (NASDAQ:ATLO) and First Horizon (NYSE:FHN) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, valuation, profitability, analyst recommendations, earnings, institutional ownership and dividends.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ames National	$54.81 million	2.96	$10.22 million	$1.14	15.83
First Horizon	$3.10 billion	3.16	$775.00 million	$1.36	13.80

First Horizon has higher revenue and earnings than Ames National. First Horizon 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 $0.80 per share and has a dividend yield of 4.4%. First Horizon pays an annual dividend of $0.60 per share and has a dividend yield of 3.2%. Ames National pays out 70.2% of its earnings in the form of a dividend. First Horizon pays out 44.1% 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.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Ames National and First Horizon, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ames National	0	0	0	0	0.00
First Horizon	0	6	9	0	2.60

First Horizon has a consensus price target of $22.23, suggesting a potential upside of 18.48%. Given First Horizon’s stronger consensus rating and higher probable upside, analysts clearly believe First Horizon is more favorable than Ames National.

Risk & Volatility

Ames National has a beta of 0.57, suggesting that its share price is 43% less volatile than the S&P 500. Comparatively, First Horizon has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500.

Institutional & Insider Ownership

26.5% of Ames National shares are held by institutional investors. Comparatively, 80.3% of First Horizon shares are held by institutional investors. 3.2% of Ames National shares are held by company insiders. Comparatively, 0.9% of First Horizon shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Ames National and First Horizon’s 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%
First Horizon	15.38%	10.10%	1.07%

Summary

First Horizon beats Ames National on 13 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 First Horizon

First Horizon Corporation operates as the bank holding company for First Horizon Bank that provides various financial services. The company operates through Regional Banking and Specialty Banking segments. It offers general banking services for consumers, businesses, financial institutions, and governments. The company also accepts deposits; provides underwriting services for bank-eligible securities and other fixed-income securities by financial subsidiaries; sells loans and derivatives; financial planning; and offers investment and financial advisory services. In addition, it offers mortgage banking; loan syndications; brokerage services; commercial and business banking for business enterprises, consumer banking, and private client and wealth management services; capital markets, professional commercial real estate, mortgage warehouse and asset-based lending, franchise and equipment finance, tax credit finance, energy and healthcare finance, asset management, and corporate and correspondent banking services. Further, the company provides transaction processing services including check clearing services and remittance processing, credit cards, investment, and sale of mutual fund and retail insurances, as well as trust, fiduciary, and agency services. First Horizon Corporation was founded in 1864 and is headquartered in Memphis, Tennessee.