Analyzing Carter Bankshares (NASDAQ:CARE) and Cullen/Frost Bankers (NYSE:CFR)

Cullen/Frost Bankers (NYSE:CFR) and Carter Bankshares (NASDAQ:CARE) are both finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, institutional ownership, risk, dividends, valuation and earnings.

Profitability

This table compares Cullen/Frost Bankers and Carter Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cullen/Frost Bankers	18.81%	15.82%	1.15%
Carter Bankshares	6.07%	4.17%	0.33%

Volatility & Risk

Cullen/Frost Bankers has a beta of 0.99, meaning that its stock price is 1% less volatile than the S&P 500. Comparatively, Carter Bankshares has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.

Institutional and Insider Ownership

86.9% of Cullen/Frost Bankers shares are owned by institutional investors. Comparatively, 41.5% of Carter Bankshares shares are owned by institutional investors. 3.0% of Cullen/Frost Bankers shares are owned by company insiders. Comparatively, 1.9% of Carter Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Cullen/Frost Bankers and Carter Bankshares”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cullen/Frost Bankers	$2.65 billion	3.38	$597.97 million	$8.06	17.29
Carter Bankshares	$214.70 million	1.99	$23.19 million	$0.62	29.87

Cullen/Frost Bankers has higher revenue and earnings than Carter Bankshares. Cullen/Frost Bankers is trading at a lower price-to-earnings ratio than Carter Bankshares, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Cullen/Frost Bankers and Carter Bankshares, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cullen/Frost Bankers	3	8	3	0	2.00
Carter Bankshares	0	0	2	0	3.00

Cullen/Frost Bankers presently has a consensus price target of $123.86, suggesting a potential downside of 11.10%. Carter Bankshares has a consensus price target of $21.50, suggesting a potential upside of 16.09%. Given Carter Bankshares’ stronger consensus rating and higher probable upside, analysts plainly believe Carter Bankshares is more favorable than Cullen/Frost Bankers.

Summary

Cullen/Frost Bankers beats Carter Bankshares on 10 of the 14 factors compared between the two stocks.

About Cullen/Frost Bankers

Cullen/Frost Bankers, Inc. operates as the bank holding company for Frost Bank that provides commercial and consumer banking services in Texas. The company offers commercial banking services to corporations, including financing for industrial and commercial properties, interim construction related to industrial and commercial properties, equipment, inventories and accounts receivables, and acquisitions; and treasury management services, as well as originates commercial leasing services. It also provides consumer banking services, such as checking accounts, savings programs, automated-teller machines (ATMs), overdraft facilities, installment and real estate loans, first mortgage loans, home equity loans and lines of credit, drive-in and night deposit services, safe deposit facilities, and brokerage services. In addition, the company offers international banking services comprising deposits, loans, letters of credit, foreign collections, funds transmitting, and foreign exchange services; correspondent banking activities, including check clearing, transfer of funds, fixed income security services, and securities custody and clearance services. Further, it offers trust, investment, agency, and custodial services for individual and corporate clients; capital market services that include sales and trading, new issue underwriting, money market trading, advisory, and securities safekeeping and clearance; and support for international business activities, including foreign exchange, letters of credit, export-import financing, and other related activities. Additionally, the company offers insurance and securities brokerage services; holding of securities for investment purposes; and investment management services for mutual funds, institutions, and individuals. It serves energy, manufacturing, services, construction, retail, telecommunications, healthcare, military, and transportation industries. The company was founded in 1868 and is headquartered in San Antonio, Texas.

About Carter Bankshares

Carter Bankshares, Inc. operates as the bank holding company for Carter Bank & Trust that provides various banking products and services in the United States. It accepts various deposit products, including checking, savings, retirement, and money market accounts, as well as certificates of deposits. The company also offers commercial loans comprising secured and unsecured loans; consumer loans, such as secured and unsecured loans for financing automobiles, home improvements, education, overdraft protection, and personal investments, as well as residential mortgages; real estate construction, acquisition, commercial, and industrial loans; home equity lines of credit; and credit cards, as well as originates and holds fixed and variable rate mortgage loans. In addition, it provides other banking services that include safe deposit boxes, direct deposit of payroll, and social security checks; online banking products, including online and mobile banking, online account opening, bill pay, e-statement, mobile deposit, digital wallet, and ATM services; title insurance and other financial institution-related products and services; and treasury and corporate cash management services. Carter Bankshares, Inc. was founded in 1974 and is headquartered in Martinsville, Virginia.