Ames National (NASDAQ:ATLO) & Danske Bank A/S (OTCMKTS:DNKEY) Critical Analysis

Ames National (NASDAQ:ATLO) and Danske Bank A/S (OTCMKTS:DNKEY) are both finance companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, valuation and institutional ownership.

Earnings and Valuation

This table compares Ames National and Danske Bank A/S”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ames National	$54.81 million	2.71	$10.22 million	$1.14	14.59
Danske Bank A/S	$8.18 billion	3.41	$3.43 billion	$2.00	8.22

Danske Bank A/S has higher revenue and earnings than Ames National. Danske Bank A/S 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 4.8%. Danske Bank A/S pays an annual dividend of $1.51 per share and has a dividend yield of 9.2%. Ames National pays out 70.2% of its earnings in the form of a dividend. Danske Bank A/S pays out 75.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Analyst Ratings

This is a breakdown of current ratings and target prices for Ames National and Danske Bank A/S, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ames National	0	0	0	0	0.00
Danske Bank A/S	1	1	1	1	2.50

Risk & Volatility

Ames National has a beta of 0.46, suggesting that its stock price is 54% less volatile than the S&P 500. Comparatively, Danske Bank A/S has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500.

Profitability

This table compares Ames National and Danske Bank A/S’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%
Danske Bank A/S	41.90%	13.35%	0.63%

Institutional and Insider Ownership

26.5% of Ames National shares are held by institutional investors. 2.1% of Ames National shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

Danske Bank A/S beats Ames National on 12 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 Danske Bank A/S

Danske Bank A/S provides various banking products and services to corporate, institutional, and international clients. The company offers insurance and pension products, mortgage finance and real-estate brokerage services, asset management and trading services in fixed income products, foreign exchange services, and equities. It also provides advisory services to personal and private banking customers; and business advisory services, including acquisition, change of ownership, strategic development, or international expansion. In addition, the company offers financing, risk management, investment, and financial advisory services for large corporates and institutions; healthcare solutions; and online and mobile banking services. It has operations in Denmark, Finland, Sweden, Norway, the United Kingdom, and internationally. The company was founded in 1871 and is headquartered in Copenhagen, Denmark.