Reviewing Carter Bankshares (NASDAQ:CARE) and Southern Missouri Bancorp (NASDAQ:SMBC)

Southern Missouri Bancorp (NASDAQ:SMBC) and Carter Bankshares (NASDAQ:CARE) are both small-cap finance companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, profitability, analyst recommendations and institutional ownership.

Profitability

This table compares Southern Missouri Bancorp and Carter Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Southern Missouri Bancorp	22.63%	12.59%	1.41%
Carter Bankshares	36.79%	7.46%	0.73%

Volatility & Risk

Southern Missouri Bancorp has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, Carter Bankshares has a beta of 0.59, suggesting that its share price is 41% less volatile than the S&P 500.

Valuation and Earnings

This table compares Southern Missouri Bancorp 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
Southern Missouri Bancorp	$316.78 million	2.43	$71.84 million	$6.43	10.88
Carter Bankshares	$214.28 million	3.12	$31.00 million	$5.81	5.19

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

Insider and Institutional Ownership

49.5% of Southern Missouri Bancorp shares are owned by institutional investors. Comparatively, 41.5% of Carter Bankshares shares are owned by institutional investors. 14.6% of Southern Missouri 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 will outperform the market over the long term.

Dividends

Southern Missouri Bancorp pays an annual dividend of $1.08 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%. Southern Missouri Bancorp pays out 16.8% 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. Southern Missouri Bancorp has increased its dividend for 13 consecutive years. Southern Missouri Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Southern Missouri Bancorp and Carter Bankshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Southern Missouri Bancorp	0	5	1	1	2.43
Carter Bankshares	0	4	1	0	2.20

Southern Missouri Bancorp presently has a consensus price target of $81.75, indicating a potential upside of 16.90%. Carter Bankshares has a consensus price target of $30.75, indicating a potential upside of 1.96%. Given Southern Missouri Bancorp’s stronger consensus rating and higher possible upside, analysts clearly believe Southern Missouri Bancorp is more favorable than Carter Bankshares.

Summary

Southern Missouri Bancorp beats Carter Bankshares on 14 of the 17 factors compared between the two stocks.

About Southern Missouri Bancorp

Southern Missouri Bancorp, Inc. operates as the bank holding company for Southern Bank that provides banking and financial services to individuals and corporate customers in the United States. The company offers deposits products, including interest-bearing and noninterest-bearing transaction accounts, saving accounts, certificates of deposit, retirement savings plans, and money market deposit accounts. It also provides loans, such as residential mortgage, commercial real estate, construction, and commercial business loans; and consumer loans comprising home equity, direct and indirect automobile loans, second mortgages, mobile home loans, and loans secured by deposits. In addition, the company offers fiduciary and investment management services; commercial and consumer insurance; online and mobile banking services; and debit or credit cards. The company was founded in 1887 and is headquartered in Poplar Bluff, Missouri.

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.