City (NASDAQ:CHCO – Get Free Report) and Carter Bankshares (NASDAQ:CARE – Get Free Report) are both small-cap finance companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.
Risk and Volatility
City has a beta of 0.47, suggesting that its stock price is 53% less volatile than the S&P 500. Comparatively, Carter Bankshares has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500.
Valuation and Earnings
This table compares City and Carter Bankshares”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| City | $279.11 million | 6.06 | $114.36 million | $7.95 | 14.42 |
| Carter Bankshares | $126.13 million | 3.11 | $23.19 million | $0.57 | 29.95 |
Profitability
This table compares City and Carter Bankshares’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| City | 32.12% | 17.42% | 1.86% |
| Carter Bankshares | 5.41% | 4.09% | 0.32% |
Analyst Ratings
This is a breakdown of recent ratings and target prices for City and Carter Bankshares, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| City | 0 | 4 | 0 | 0 | 2.00 |
| Carter Bankshares | 0 | 0 | 2 | 0 | 3.00 |
City presently has a consensus price target of $106.75, indicating a potential downside of 6.90%. Carter Bankshares has a consensus price target of $21.50, indicating a potential upside of 25.95%. Given Carter Bankshares’ stronger consensus rating and higher possible upside, analysts plainly believe Carter Bankshares is more favorable than City.
Insider and Institutional Ownership
72.4% of City shares are held by institutional investors. Comparatively, 41.5% of Carter Bankshares shares are held by institutional investors. 2.5% of City shares are held by company insiders. Comparatively, 1.9% of Carter Bankshares shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Summary
City beats Carter Bankshares on 9 of the 14 factors compared between the two stocks.
About City
City Holding Company operates as a holding company for City National Bank of West Virginia that provides various banking, trust, and investment management, and other financial solutions in the United States. The company offers checking, savings, and money market accounts, as well as certificates of deposit and individual retirement accounts. It also provides commercial and industrial loans that consist of loans to corporate and other legal entity borrowers primarily in small to mid-size industrial and commercial companies; commercial real estate loans comprising commercial mortgages, which are secured by nonresidential and multi-family residential properties; residential real estate loans to consumers for the purchase or refinance of residence; first-priority home equity loans; home equity lines of credit; amortized home equity loans; consumer loans that are secured and unsecured by automobiles, boats, recreational vehicles, certificates of deposit, and other personal property; and demand deposit account overdrafts, as well as owner-occupied real estate and construction, land development, and lines of credit. In addition, the company offers mortgage banking services, including fixed and adjustable-rate mortgages, construction financing, land loans, production of conventional and government-insured mortgages, secondary marketing, and mortgage servicing. Further, it provides deposit services for commercial customers comprising treasury management, lockbox, and other cash management services; merchant credit card services; wealth management, trust, investment, and custodial services for commercial and individual customers; and corporate trust and institutional custody, financial and estate planning, and retirement plan services, as well as automated-teller-machine, interactive-teller-machine, mobile banking, interactive voice response systems, and credit and debit card services. City Holding Company was founded in 1957 and is headquartered in Charleston, West Virginia.
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.
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