NasdaqCM:FMAO

Stock Analysis Report

Farmers & Merchants Bancorp

Executive Summary

Farmers & Merchants Bancorp, Inc. operates as the bank holding company for The Farmers & Merchants State Bank that provides commercial banking, retail banking, and other financial products and services to individuals and small businesses in northwest Ohio and northeast Indiana.

Rewards

Trading at 5% below its fair value

Earnings are forecast to grow 5.82% per year

Earnings have grown 11.7% per year over the past 5 years

Pays a reliable dividend of 2.26%

Risk Analysis

Shareholders have been diluted in the past year



Snowflake Analysis

Flawless balance sheet average dividend payer.


Similar Companies

MVB Financial

NasdaqCM:MVBF

Share Price & News

How has Farmers & Merchants Bancorp's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FMAO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.1%

FMAO

3.4%

US Banks

1.3%

US Market


1 Year Return

-31.9%

FMAO

26.8%

US Banks

19.4%

US Market

Return vs Industry: FMAO underperformed the US Banks industry which returned 26.8% over the past year.

Return vs Market: FMAO underperformed the US Market which returned 19.4% over the past year.


Shareholder returns

FMAOIndustryMarket
7 Day3.1%3.4%1.3%
30 Day4.1%3.8%2.6%
90 Day-1.6%10.7%5.0%
1 Year-30.5%-31.9%30.6%26.8%22.0%19.4%
3 Year63.0%54.5%33.9%24.5%46.8%37.3%
5 Year134.2%108.0%76.7%57.0%66.3%48.0%

Price Volatility Vs. Market

How volatile is Farmers & Merchants Bancorp's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Farmers & Merchants Bancorp undervalued compared to its fair value and its price relative to the market?

5.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FMAO ($26.57) is trading below our estimate of fair value ($27.98)

Significantly Below Fair Value: FMAO is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: FMAO is poor value based on its PE Ratio (16.8x) compared to the Banks industry average (12.9x).

PE vs Market: FMAO is good value based on its PE Ratio (16.8x) compared to the US market (18.7x).


Price to Earnings Growth Ratio

PEG Ratio: FMAO is poor value based on its PEG Ratio (2.9x)


Price to Book Ratio

PB vs Industry: FMAO is overvalued based on its PB Ratio (1.3x) compared to the US Banks industry average (1.2x).


Next Steps

Future Growth

How is Farmers & Merchants Bancorp forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

5.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FMAO's forecast earnings growth (5.8% per year) is above the savings rate (1.7%).

Earnings vs Market: FMAO's earnings (5.8% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: FMAO's earnings are forecast to grow, but not significantly.

Revenue vs Market: FMAO's revenue is expected to decline over the next 3 years (-5.6% per year).

High Growth Revenue: FMAO's revenue is forecast to decline over the next 3 years (-5.6% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if FMAO's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Farmers & Merchants Bancorp performed over the past 5 years?

11.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FMAO has high quality earnings.

Growing Profit Margin: FMAO's current net profit margins (27.2%) are lower than last year (30.2%).


Past Earnings Growth Analysis

Earnings Trend: FMAO's earnings have grown by 11.7% per year over the past 5 years.

Accelerating Growth: FMAO's earnings growth over the past year (11.3%) is below its 5-year average (11.7% per year).

Earnings vs Industry: FMAO earnings growth over the past year (11.3%) underperformed the Banks industry 27.1%.


Return on Equity

High ROE: FMAO's Return on Equity (7.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Farmers & Merchants Bancorp's financial position? (This company is analysed differently as a bank or financial institution)


Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet

Inventory Level: FMAO has a low level of unsold assets or inventory.

Debt Coverage by Assets: FMAO's debt is covered by short term assets (assets are 2.2x debt).


Financial Institutions Analysis

Asset Level: FMAO's level of assets compared to its equity is low.

Allowance for Bad Loans: FMAO has a sufficient allowance for bad loans.

Low Risk Liabilities: FMAO's liabilities are made up of primarily low risk sources of funding.

Loan Level: FMAO has an acceptable proportion of non-loan assets held.

Low Risk Deposits: FMAO's loans are broadly funded by customer deposits.

Level of Bad Loans: FMAO has an appropriate level of bad loans (0.28%)


Next Steps

Dividend

What is Farmers & Merchants Bancorp's current dividend yield, its reliability and sustainability?

2.26%

Current Dividend Yield


Dividend Yield vs Market

company2.3%marketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Years2.3%

Current dividend yield vs market & industry

Notable Dividend: FMAO's dividend (2.26%) is higher than the bottom 25% of dividend payers in the US market (1.42%).

High Dividend: FMAO's dividend (2.26%) is low compared to the top 25% of dividend payers in the US market (3.68%).


Stability and Growth of Payments

Stable Dividend: FMAO's dividends per share have been stable in the past 10 years.

Growing Dividend: FMAO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (37.9%), FMAO's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

What is the CEO of Farmers & Merchants Bancorp's salary, the management and board of directors tenure and is there insider trading?

11.9yrs

Average management tenure


CEO

Lars Eller (52yo)

0.8yrs

Tenure

US$425,843

Compensation

Mr. Lars B. Eller is President and Chief Executive Officer at Farmers & Merchants Bancorp, Inc. since February 5, 2019. Mr. Eller is President and Chief Executive Officer at Farmers & Merchants State Bank  ...


CEO Compensation Analysis

Compensation vs Market: Lars's total compensation ($USD425.84K) is below average for companies of similar size in the US market ($USD1.10M).

Compensation vs Earnings: Insufficient data to compare Lars's compensation with company performance.


Management Age and Tenure

11.9yrs

Average Tenure

59yo

Average Age

Experienced Management: FMAO's management team is seasoned and experienced (11.9 years average tenure).


Board Age and Tenure

10.9yrs

Average Tenure

64yo

Average Age

Experienced Board: FMAO's board of directors are seasoned and experienced ( 10.9 years average tenure).


Insider Trading

Insider Buying: FMAO insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$38,62502 Dec 19
Jo Hornish
EntityIndividual
Shares1,500
Max PriceUS$25.75
BuyUS$84,77825 Nov 19
Jo Hornish
EntityIndividual
Shares3,282
Max PriceUS$25.84
BuyUS$64,42521 Nov 19
Jo Hornish
EntityIndividual
Shares2,500
Max PriceUS$25.77
BuyUS$16,56330 Aug 19
Marcia Latta
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares662
Max PriceUS$25.02
BuyUS$5,41627 Aug 19
Lars Eller
EntityIndividual
Role
Chief Executive Officer
President
Shares214
Max PriceUS$25.31
BuyUS$30,43527 Aug 19
Lars Eller
EntityIndividual
Role
Chief Executive Officer
President
Shares1,186
Max PriceUS$25.75

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 15.2%.


Management Team

  • Kevin Sauder (58yo)

    VP & Director

    • Tenure: 15.9yrs
    • Compensation: US$38.35k
  • Rex Rice (60yo)

    Executive VP & Senior Commercial Banking Manager

    • Tenure: 0yrs
    • Compensation: US$353.36k
  • Ed Leininger (62yo)

    Executive VP & COO

    • Tenure: 15.4yrs
    • Compensation: US$331.11k
  • Barb Britenriker (57yo)

    Executive VP

    • Tenure: 0yrs
    • Compensation: US$438.45k
  • Todd Graham (68yo)

    Executive VP & Chief Lending Officer

    • Tenure: 11.9yrs
    • Compensation: US$326.49k
  • Lars Eller (52yo)

    President

    • Tenure: 0.8yrs
    • Compensation: US$425.84k
  • Diann Meyer-Grieser (58yo)

    VP & Human Resource Manager

    • Tenure: 0yrs
  • Marilyn Johnson

    VP and Compliance & CRA Manager

    • Tenure: 0yrs
  • J. Filogamo (66yo)

    Senior VP & Marketing Manager

    • Tenure: 0yrs
  • Deborah Shinabery

    VP & Sales Manager

    • Tenure: 0yrs

Board Members

  • Kevin Sauder (58yo)

    VP & Director

    • Tenure: 15.9yrs
    • Compensation: US$38.35k
  • Anthony Rupp (69yo)

    Vice Chairman of the Board

    • Tenure: 0yrs
    • Compensation: US$37.13k
  • Steven Everhart (64yo)

    Independent Director

    • Tenure: 16.9yrs
    • Compensation: US$42.80k
  • Jack Johnson (66yo)

    Chairman of the Board

    • Tenure: 6.4yrs
    • Compensation: US$44.55k
  • Paul Siebenmorgen (69yo)

    Director

    • Tenure: 14.7yrs
    • Compensation: US$820.22k
  • Steven Planson (59yo)

    Independent Director

    • Tenure: 11.9yrs
    • Compensation: US$39.90k
  • Marcia Latta (57yo)

    Independent Director

    • Tenure: 10.9yrs
    • Compensation: US$35.98k
  • Eugene Burkholder (66yo)

    Independent Director

    • Tenure: 7.8yrs
    • Compensation: US$34.85k
  • Lars Eller (52yo)

    President

    • Tenure: 0.8yrs
    • Compensation: US$425.84k
  • Andrew Briggs (64yo)

    1st Senior VP of Business Development & Director

    • Tenure: 0.9yrs

Company Information

Farmers & Merchants Bancorp, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Farmers & Merchants Bancorp, Inc.
  • Ticker: FMAO
  • Exchange: NasdaqCM
  • Founded: 1897
  • Industry: Regional Banks
  • Sector: Banks
  • Market Cap: US$293.414m
  • Shares outstanding: 11.04m
  • Website: https://www.fm.bank

Number of Employees


Location

  • Farmers & Merchants Bancorp, Inc.
  • 307 North Defiance Street
  • Archbold
  • Ohio
  • 43502
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FMAONasdaqCM (Nasdaq Capital Market)YesCommon StockUSUSDNov 2004

Biography

Farmers & Merchants Bancorp, Inc. operates as the bank holding company for The Farmers & Merchants State Bank that provides commercial banking, retail banking, and other financial products and services to  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/12 23:49
End of Day Share Price2019/12/12 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.