Stock Analysis

Shareholders Will Probably Not Have Any Issues With Ames National Corporation's (NASDAQ:ATLO) CEO Compensation

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NasdaqCM:ATLO
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Shareholders may be wondering what CEO John Nelson plans to do to improve the less than great performance at Ames National Corporation (NASDAQ:ATLO) recently. At the next AGM coming up on 28 April 2021, they can influence managerial decision making through voting on resolutions, including executive remuneration. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We think CEO compensation looks appropriate given the data we have put together.

See our latest analysis for Ames National

Comparing Ames National Corporation's CEO Compensation With the industry

Our data indicates that Ames National Corporation has a market capitalization of US$230m, and total annual CEO compensation was reported as US$459k for the year to December 2020. That's just a smallish increase of 6.9% on last year. Notably, the salary which is US$367.6k, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from US$100m to US$400m, the reported median CEO total compensation was US$777k. Accordingly, Ames National pays its CEO under the industry median. Furthermore, John Nelson directly owns US$291k worth of shares in the company.

Component20202019Proportion (2020)
Salary US$368k US$345k 80%
Other US$92k US$84k 20%
Total CompensationUS$459k US$429k100%

Speaking on an industry level, nearly 42% of total compensation represents salary, while the remainder of 58% is other remuneration. Ames National pays out 80% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

ceo-compensation
NasdaqCM:ATLO CEO Compensation April 23rd 2021

Ames National Corporation's Growth

Ames National Corporation's earnings per share (EPS) grew 15% per year over the last three years. Its revenue is up 17% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Ames National Corporation Been A Good Investment?

Given the total shareholder loss of 0.9% over three years, many shareholders in Ames National Corporation are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

The lacklustre share price returns is rather divergent to the robust growth in EPS, suggesting that there may be other factors weighing on it apart from fundamentals. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board and assess if the board's plan is likely to improve company performance.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Ames National (free visualization of insider trades).

Switching gears from Ames National, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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