First Bancorp (NASDAQ:FBNC – Get Free Report) and Carter Bankshares (NASDAQ:CARE – Get Free Report) are both finance companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, valuation, risk, analyst recommendations, earnings, dividends and profitability.
Dividends
First Bancorp pays an annual dividend of $0.96 per share and has a dividend yield of 1.5%. Carter Bankshares pays an annual dividend of $0.40 per share and has a dividend yield of 1.3%. First Bancorp pays out 29.8% of its earnings in the form of a dividend. Carter Bankshares pays out 6.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Valuation and Earnings
This table compares First Bancorp 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 | |
| First Bancorp | $549.30 million | 4.68 | $111.05 million | $3.22 | 19.31 |
| Carter Bankshares | $254.63 million | 2.65 | $31.00 million | $5.81 | 5.25 |
First Bancorp has higher revenue and earnings than Carter Bankshares. Carter Bankshares is trading at a lower price-to-earnings ratio than First Bancorp, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares First Bancorp and Carter Bankshares’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| First Bancorp | 22.12% | 11.31% | 1.46% |
| Carter Bankshares | 36.79% | 7.46% | 0.73% |
Institutional and Insider Ownership
68.4% of First Bancorp shares are owned by institutional investors. Comparatively, 41.5% of Carter Bankshares shares are owned by institutional investors. 2.0% of First Bancorp shares are owned by company insiders. Comparatively, 2.4% of Carter Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Analyst Ratings
This is a breakdown of current ratings and target prices for First Bancorp and Carter Bankshares, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| First Bancorp | 1 | 2 | 2 | 1 | 2.50 |
| Carter Bankshares | 0 | 4 | 1 | 0 | 2.20 |
First Bancorp currently has a consensus price target of $68.94, suggesting a potential upside of 10.87%. Carter Bankshares has a consensus price target of $30.75, suggesting a potential upside of 0.85%. Given First Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe First Bancorp is more favorable than Carter Bankshares.
Volatility & Risk
First Bancorp has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500. Comparatively, Carter Bankshares has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.
Summary
First Bancorp beats Carter Bankshares on 13 of the 17 factors compared between the two stocks.
About First Bancorp
First Bancorp operates as the bank holding company for First Bank that provides banking products and services for individuals and small to medium-sized businesses. The company accepts deposit products, such as checking, savings, and money market accounts, as well as time deposits, including certificate of deposits and individual retirement accounts. It also offers loans for a range of consumer and commercial purposes comprising loans for business, real estate, personal, home improvement, and automobiles, as well as residential mortgages and small business administration loans; and accounts receivable financing and factoring, inventory financing, and purchase order financing services. In addition, the company provides credit and debit cards, letter of credits, and safe deposit box rental services, as well as electronic funds transfer services consisting of wire transfers; and internet and mobile banking, cash management, bank-by-phone services, and remote deposit capture services. Further, it offers investment and insurance products, such as mutual funds, annuities, long-term care insurance, life insurance, and company retirement plans, as well as property and casualty insurance products; and financial planning services. The company was founded in 1934 and is headquartered in Southern Pines, North Carolina.
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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