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what it is
It gathers deposits and makes loans to farmers, homeowners, and small businesses, then earns money on the difference.
how it gets paid
Last year Farmers & Merchants made $174M in revenue.
why it's growing
Total revenue rose about 4–5% vs. prior year in the latest annual comparison (verify the exact line-item bridge in the 10-K). $0.71 matters because it annualizes to $2.84, which sits above the current $2.42 full-year earnings view.
what just happened
Latest quarter revenue hit $45M and EPS reached $0.71, up 6% and 16% vs. prior year.
At a glance
B balance sheet — gets the job done, barely
75/100 earnings predictability — reasonably predictable
12.0x trailing p/e — the market's not buying it — or you found a deal
3.8% dividend yield — cash in your pocket every quarter
$2.42 fy2025 eps est
xvary composite: 55/100 — below average
What they do
It gathers deposits and makes loans to farmers, homeowners, and small businesses, then earns money on the difference.
Your checking account is sticky because moving direct deposit, bill pay, and loans is a hassle. FMAO has $2.75 billion of deposits backing $3.39 billion of assets, which means cheap funding (low-cost money to lend = better profit per loan). With 473 employees focused on local relationships, it can win on familiarity while bigger banks chase scale.
How they make money
$174M
annual revenue · their business grew about +4.6% last year (full-year comparable; confirm in SEC filings)
total revenue
$174M
+4.6%
The products that matter
business lending and treasury services
Commercial banking
$119M net interest income
this is the core engine. a bank showing $119M in annual net interest income lives or dies on loan pricing, funding costs, and credit discipline.
core profit driver
consumer deposits and local lending
Retail banking
$2.75B deposit base
those $2.75B in deposits matter because they fund the loan book. In human-speak: cheaper deposits usually mean better margins, and better margins are the whole game.
funding base
fee-based client services
Wealth management & insurance
part of $55M non-interest income
fee income is smaller here, but it matters because it gives you revenue that does not depend entirely on loan spreads. For a community bank, that diversification is useful even when it is not dramatic.
stability lever
Key numbers
$2.42
FY2025 EPS
The current earnings view is $2.42 versus trailing EPS of $2.04, or about 19% more profit if the recovery sticks.
3.8%
dividend yield
The quarterly dividend is $0.23, or $0.92 annualized, so you collect cash while waiting for earnings to improve.
45%
debt to capital
Long-term debt is $281 million, equal to 45% of capital, which is manageable but leaves less margin for mistakes.
$2.75B
total deposits
Deposits are banking fuel, and $2.75 billion gives this $337 million company a much larger funding base than its stock price suggests.
Financial health
B
strength
- balance sheet grade B — adequate — nothing special
- risk rank 3 — safer than 50% of stocks
- price stability 55 / 100
- long-term debt $281M (45% of capital)
B — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for FMAO right now.
source: institutional data · return history unavailable
What just happened
beat estimates
Latest quarter revenue hit $45M and EPS reached $0.71, up 6% and 16% vs. prior year.
The quarter showed steady top-line growth and better profit conversion. EPS of $0.71 also ran ahead of the next-quarter expectation around $0.65 from consensus data.
$45M
revenue (q)
$0.71
eps (q)
27.9%
net margin (q)
the number that mattered
$0.71 matters because it annualizes to $2.84, which sits above the current $2.42 full-year earnings view.
source: company earnings report, 2026
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What could go wrong
the risk is not abstract. you are buying a $337M bank whose core earnings engine depends on a $2.75B deposit base, $119M of net interest income, and profitability still hovering around the 1% ROA line.
high
interest-rate sensitivity
the bank generated $119M in net interest income. that means spread income is the business. if deposit costs rise faster than loan yields, margins get squeezed fast.
the main earnings engine slows without any dramatic change in loan volume.
med
central california credit concentration
this is a local bank serving a local economy. if agriculture, small business conditions, or regional real estate weaken, credit costs move the wrong way together.
geographic focus helps relationships. it also concentrates pain.
med
balance-sheet flexibility is fine, not special
long-term debt is $281M, or 45% of capital, and the balance sheet grade is B. that does not signal distress. it also does not give you much room to pretend this bank has unusual balance sheet grade.
if earnings wobble, the market has less reason to give management the benefit of the doubt.
med
execution stalls just below the line
return on average assets improved from 0.78% to 0.99%. that is the right direction. the catch is that investors often reward clear thresholds, not near-misses.
if ROA cannot stay above 1%, the stock stays cheap for a reason.
for you, the key risk is simple: a merely decent bank at 12.0x earnings does not have much narrative protection if margins or credit quality slip.
source: institutional data · regulatory filings · risk analysis
Pay attention to
earnings
q1 2026 earnings report
estimated report date is april 27, 2026. consensus EPS estimate is $0.62. for a stock this small, a few cents either way changes the tone fast.
profitability
return on assets needs to clear 1%
ROA improved to 0.99% from 0.78%. that is close enough to matter and just far enough away to keep the valuation modest.
street view
published targets sit in a tight $26–$30 band
with the stock at $27.95, analysts are not calling for a dramatic move. in human-speak, this is an execution story, not a momentum story.
funding risk
watch the deposit base
the $2.75B deposit base is the funding that supports lending. if that money gets more expensive, net interest income feels it first.
Analyst rankings
earnings predictability
75 / 100
in human-speak: the numbers are fairly stable, which is what you want from a community bank.
valuation signal
12.0x trailing p/e
you are not paying growth-stock prices here. the market is asking for proof that recent income gains are sustainable.
source: institutional data
Institutional activity
institutional ownership data for FMAO is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$28
current price
n/a
target midpoint · n/a from current
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