Contrasting First Commonwealth Financial (NYSE:FCF) & Carter Bankshares (NASDAQ:CARE)

First Commonwealth Financial (NYSE:FCF) and Carter Bankshares (NASDAQ:CARE) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, dividends, valuation, earnings and profitability.

Profitability

This table compares First Commonwealth Financial and Carter Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Commonwealth Financial	20.88%	10.43%	1.30%
Carter Bankshares	12.32%	7.64%	0.65%

Analyst Ratings

This is a summary of recent ratings and recommmendations for First Commonwealth Financial and Carter Bankshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Commonwealth Financial	0	3	4	0	2.57
Carter Bankshares	0	1	2	1	3.00

First Commonwealth Financial currently has a consensus price target of $19.75, indicating a potential upside of 14.79%. Carter Bankshares has a consensus price target of $22.00, indicating a potential upside of 8.21%. Given First Commonwealth Financial’s higher probable upside, analysts clearly believe First Commonwealth Financial is more favorable than Carter Bankshares.

Earnings & Valuation

This table compares First Commonwealth Financial and Carter Bankshares”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Commonwealth Financial	$729.51 million	2.41	$152.30 million	$1.46	11.78
Carter Bankshares	$254.63 million	1.77	$31.00 million	$1.38	14.73

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

Institutional & Insider Ownership

72.6% of First Commonwealth Financial shares are held by institutional investors. Comparatively, 41.5% of Carter Bankshares shares are held by institutional investors. 2.2% of First Commonwealth Financial 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, large money managers and endowments believe a company will outperform the market over the long term.

Risk & Volatility

First Commonwealth Financial has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Carter Bankshares has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500.

Summary

First Commonwealth Financial beats Carter Bankshares on 12 of the 15 factors compared between the two stocks.

About First Commonwealth Financial

First Commonwealth Financial Corporation, a financial holding company, provides various consumer and commercial banking services in the United States. Its consumer services include personal checking accounts, interest-earning checking accounts, savings and health savings accounts, insured money market accounts, debit cards, investment certificates, fixed and variable rate certificates of deposit, mortgage loans, secured and unsecured installment loans, construction and real estate loans, safe deposit facilities, credit cards, credit lines with overdraft checking protection, IRA accounts, and automated teller machine (atm) services, as well as internet, mobile, and telephone banking services. The company's commercial banking services comprise commercial lending, business checking accounts, online account management services, payroll direct deposits, commercial cash management services, and repurchase agreements, as well as ACH origination services. In addition, it offers various trust and asset management services; auto, home, and business insurance, as well as term life insurance; and annuities, mutual funds, and stock and bond brokerage services through a broker-dealer and insurance brokers. The company was founded in 1934 and is headquartered in Indiana, Pennsylvania.

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.