Cullen/Frost Bankers (NYSE:CFR – Get Free Report) and Carter Bankshares (NASDAQ:CARE – Get Free Report) are both finance companies, but which is the better business? We will compare the two businesses based on the strength of their risk, earnings, profitability, dividends, valuation, analyst recommendations and institutional ownership.
Institutional & Insider Ownership
86.9% of Cullen/Frost Bankers shares are held by institutional investors. Comparatively, 41.5% of Carter Bankshares shares are held by institutional investors. 2.9% of Cullen/Frost Bankers 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 endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
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% |
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Cullen/Frost Bankers | $2.65 billion | 3.35 | $597.97 million | $8.06 | 17.14 |
| Carter Bankshares | $214.70 million | 2.05 | $23.19 million | $0.62 | 30.77 |
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 recommmendations for Cullen/Frost Bankers and Carter Bankshares, as reported 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 target price of $125.43, indicating a potential downside of 9.22%. Carter Bankshares has a consensus target price of $21.50, indicating a potential upside of 12.68%. Given Carter Bankshares’ stronger consensus rating and higher probable upside, analysts clearly believe Carter Bankshares is more favorable than Cullen/Frost Bankers.
Risk & Volatility
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.
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.
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