For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it currently lacks a track record of revenue and profit. Sometimes these stories can cloud the minds of investors, leading them to invest with their emotions rather than on the merit of good company fundamentals. A loss-making company is yet to prove itself with profit, and eventually the inflow of external capital may dry up.
If this kind of company isn't your style, you like companies that generate revenue, and even earn profits, then you may well be interested in Ames National( NASDAQ:ATLO ). Now this is not to say that the company presents the best investment opportunity around, but profitability is a key component to success in business.
Ames National's Earnings Per Share Are Growing
Generally, companies experiencing growth in earnings per share (EPS) should see similar trends in share price. That makes EPS growth an attractive quality for any company. We can see that in the last three years Ames National grew its EPS by 8.1% per year. That growth rate is fairly good, assuming the company can keep it up.
It's often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company's growth. Our analysis has highlighted that Ames National's revenue from operations did not account for all of their revenue in the previous 12 months, so our analysis of its margins might not accurately reflect the underlying business. EBIT margins for Ames National remained fairly unchanged over the last year, however the company should be pleased to report its revenue growth for the period of 26% to US$69m. That's a real positive.
In the chart below, you can see how the company has grown earnings and revenue, over time. For finer detail, click on the image.
View our latest analysis for Ames National
Since Ames National is no giant, with a market capitalisation of US$248m, you should definitely check its cash and debt before getting too excited about its prospects.
Are Ames National Insiders Aligned With All Shareholders?
Investors are always searching for a vote of confidence in the companies they hold and insider buying is one of the key indicators for optimism on the market. This view is based on the possibility that stock purchases signal bullishness on behalf of the buyer. Of course, we can never be sure what insiders are thinking, we can only judge their actions.
We note that Ames National insiders spent US$124k on stock, over the last year; in contrast, we didn't see any selling. That paints the company in a nice light, as it signals that its leaders are feeling confident in where the company is heading. We also note that it was the company insider, Douglas Beals, who made the biggest single acquisition, paying US$11k for shares at about US$21.37 each.
It's commendable to see that insiders have been buying shares in Ames National, but there is more evidence of shareholder friendly management. Namely, Ames National has a very reasonable level of CEO pay. For companies with market capitalisations between US$100m and US$400m, like Ames National, the median CEO pay is around US$1.6m.
The Ames National CEO received total compensation of just US$435k in the year to December 2025. That's clearly well below average, so at a glance that arrangement seems generous to shareholders and points to a modest remuneration culture. CEO compensation is hardly the most important aspect of a company to consider, but when it's reasonable, that gives a little more confidence that leadership are looking out for shareholder interests. It can also be a sign of good governance, more generally.
Does Ames National Deserve A Spot On Your Watchlist?
One positive for Ames National is that it is growing EPS. That's nice to see. And that's not all. We've also seen insiders buying stock, and noted modest executive pay. If these factors aren't enough to secure Ames National a spot on the watchlist, then it certainly warrants a closer look at the very least. It's still necessary to consider the ever-present spectre of investment risk. We've identified 1 warning sign with Ames National , and understanding this should be part of your investment process.
The good news is that Ames National is not the only stock with insider buying. Here's a list of small cap, undervalued companies in the US with insider buying in the last three months!
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.
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This article by Simply Wall St is general in nature.
We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice.
It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
