Head to Head Comparison: Ames National (NASDAQ:ATLO) versus First Financial Bancorp. (NASDAQ:FFBC)

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

Dividends

Ames National pays an annual dividend of $0.80 per share and has a dividend yield of 3.8%. First Financial Bancorp. pays an annual dividend of $1.00 per share and has a dividend yield of 4.2%. Ames National pays out 44.4% of its earnings in the form of a dividend. First Financial Bancorp. pays out 37.0% 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. First Financial Bancorp. has raised its dividend for 1 consecutive years. First Financial Bancorp. is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Ames National has a beta of 0.43, indicating that its share price is 57% less volatile than the S&P 500. Comparatively, First Financial Bancorp. has a beta of 0.96, indicating that its share price is 4% less volatile than the S&P 500.

Earnings & Valuation

This table compares Ames National and First Financial Bancorp.”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ames National	$92.44 million	2.03	$10.22 million	$1.80	11.69
First Financial Bancorp.	$1.62 billion	1.42	$228.83 million	$2.70	8.90

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

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Ames National and First Financial Bancorp., as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ames National	0	1	0	0	2.00
First Financial Bancorp.	0	4	4	0	2.50

First Financial Bancorp. has a consensus price target of $29.50, suggesting a potential upside of 22.76%. Given First Financial Bancorp.’s stronger consensus rating and higher probable upside, analysts clearly believe First Financial Bancorp. is more favorable than Ames National.

Profitability

This table compares Ames National and First Financial Bancorp.’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ames National	16.68%	8.73%	0.75%
First Financial Bancorp.	20.64%	10.72%	1.46%

Insider and Institutional Ownership

26.5% of Ames National shares are owned by institutional investors. Comparatively, 77.2% of First Financial Bancorp. shares are owned by institutional investors. 2.1% of Ames National shares are owned by insiders. Comparatively, 1.1% of First Financial Bancorp. shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

First Financial Bancorp. beats Ames National on 14 of the 17 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 Financial Bancorp.

First Financial Bancorp. operates as the bank holding company for First Financial Bank that provides commercial banking and related services to individuals and businesses in Ohio, Indiana, Kentucky, and Illinois. The company offers checking, savings, and money-market accounts; and accepts various deposit products, such as interest-bearing and non-interest-bearing accounts, time deposits, and cash management services for commercial customers. It also provides real estate loans secured by residential property, such as one to four family residential housing units or commercial property comprising owner-occupied and/or investor income producing real estate consisting of apartments, shopping centers, and office buildings; commercial and industrial loans for various purposes, including inventory, receivables, and equipment, as well as equipment and leasehold improvement financing for franchisees; consumer loans comprising new and used vehicle loans, second mortgages on residential real estate, and unsecured loans; and home equity lines of credit. In addition, the company offers commercial financing to the insurance industry, registered investment advisors, certified public accountants, indirect auto finance companies, and restaurant franchisees. Further, it provides a range of trust and wealth management services; lease and equipment financing services; and currency payments, foreign exchange hedging, and other advisory products. First Financial Bancorp. was founded in 1863 and is headquartered in Cincinnati, Ohio.