Breaking Down Carter Bankshares, Inc. (CARE) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments? Interested in the financial health of Carter Bankshares, Inc. (CARE)? In 2024, the company reported a revenue of $140.87 million and earnings of $24.3 million. Furthermore, in the fourth quarter of 2024, Carter Bankshares announced a net income of $8.3 million, which translates to $0.36 earnings per share. With a Tier 1 Capital ratio of 10.88% and a leverage ratio of 9.56% as of December 31, 2024, how stable is Carter Bankshares' financial foundation? Read on to discover key insights that can help you make informed decisions.

Carter Bankshares, Inc. (CARE) Revenue Analysis

Understanding Carter Bankshares, Inc. (CARE)'s revenue streams involves examining its primary sources of income, historical growth, and the contributions from different business segments. Analyzing these aspects provides key insights into the bank's financial health and stability.

Primary Revenue Sources:

Carter Bankshares, Inc. (CARE) primarily generates revenue through:

• Interest Income: This comes from loans, including commercial, residential, and consumer loans.
• Service Fees and Other Charges: Revenue is derived from various customer services.

Year-over-Year Revenue Growth Rate:

Analyzing the year-over-year revenue growth rate reveals trends in Carter Bankshares, Inc. (CARE)'s financial performance. For instance, reviewing historical data can show whether the bank has consistently grown its revenue or experienced fluctuations.

According to the 2024 fiscal year data, Carter Bankshares, Inc. (CARE) reported a net interest income of $147.9 million, down from $161.4 million in the prior year. The total non-interest income was $23.4 million, compared to $21.5 million in the previous year. These figures highlight the dynamics between interest and non-interest income streams.

Contribution of Business Segments:

The bank's revenue can be further dissected by examining the contribution of different business segments. This includes commercial lending, retail banking, and wealth management services, if applicable. Understanding which segments drive the most revenue helps assess the bank's strategic focus and diversification.

Analysis of Significant Changes in Revenue Streams:

Significant changes in revenue streams can indicate strategic shifts or market impacts. For example, a notable increase in non-interest income could reflect a focus on fee-based services, while a decline in interest income might signal changes in lending practices or interest rate environments.

In 2024, Carter Bankshares, Inc. (CARE) experienced a decrease in net interest income due to increased interest expenses, while non-interest income saw a rise, driven by gains on sales of securities and increases in other income. These shifts are important for investors to understand the evolving revenue composition of the bank.

The table below summarizes key aspects of Carter Bankshares, Inc. (CARE)'s revenue streams based on available data:

For further insights into Carter Bankshares, Inc. (CARE)'s financial health, you can explore: Breaking Down Carter Bankshares, Inc. (CARE) Financial Health: Key Insights for Investors

Carter Bankshares, Inc. (CARE) Profitability Metrics

Assessing the profitability of Carter Bankshares, Inc. (CARE) involves examining several key metrics that provide insights into the company's financial health and operational efficiency. These include gross profit, operating profit, and net profit margins, alongside an analysis of their trends over time and comparison against industry averages.

For the fiscal year 2024, Carter Bankshares reported a net income available to common shareholders of $45.7 million. This translates to diluted earnings per share of $1.88. The return on average assets was 0.94%, and the return on average common equity stood at 9.31%.

A closer look at operational efficiency reveals the following:

• Net interest income was reported at $139.5 million.
• The net interest margin was 3.42% for the year.

Non-interest income totaled $34.4 million for the year 2024, while non-interest expense reached $124.9 million.

To provide a clearer picture, here's a summary of Carter Bankshares, Inc.'s key profitability metrics:

Understanding these metrics is crucial for investors seeking to evaluate Carter Bankshares, Inc.'s financial performance and stability. For further insights, you might find this resource helpful: Breaking Down Carter Bankshares, Inc. (CARE) Financial Health: Key Insights for Investors.

Carter Bankshares, Inc. (CARE) Debt vs. Equity Structure

Understanding how Carter Bankshares, Inc. (CARE) finances its operations is crucial for investors. This involves examining the levels and types of debt the company holds, as well as how it balances debt with equity.

As of the fiscal year 2024, Carter Bankshares, Inc.'s financial structure includes a mix of both short-term and long-term debt. While specific figures for the fiscal year 2024 are not available, analyzing the trends and ratios can provide insights. For instance, the debt-to-equity ratio is a key metric to assess the balance between debt and equity. Keep in mind that this ratio fluctuates and is influenced by factors such as interest rates, market conditions, and company performance. A higher ratio indicates more reliance on debt, which can amplify both risk and potential returns.

To contextualize Carter Bankshares, Inc.'s debt-to-equity ratio, it's essential to compare it against industry standards. The banking industry's average debt-to-equity ratio can serve as a benchmark. If Carter Bankshares, Inc.'s ratio is significantly higher than its peers, it may signal higher financial leverage. Conversely, a lower ratio might indicate a more conservative approach to financing.

Recent activities such as debt issuances, credit ratings, or refinancing play a significant role in shaping the company’s debt profile. Here are some key considerations:

• Debt Issuances: Any new debt issued can change the overall debt level and structure.
• Credit Ratings: Ratings from agencies like Moody's or S&P provide an external assessment of creditworthiness.
• Refinancing: Refinancing existing debt can alter interest rates and repayment terms.

Balancing debt and equity is a strategic decision. Debt financing can offer tax advantages and potentially higher returns on equity if the company performs well. However, it also brings the risk of increased financial distress if earnings decline. Equity funding, on the other hand, dilutes ownership but provides a more stable capital base.

Given the dynamic nature of financial markets and company-specific decisions, investors should regularly monitor Carter Bankshares, Inc.'s financial statements and related disclosures. Here is a sample table that investors can create to track the key information:

For additional insights into Carter Bankshares, Inc. (CARE) financial health, you can refer to: Breaking Down Carter Bankshares, Inc. (CARE) Financial Health: Key Insights for Investors.

Carter Bankshares, Inc. (CARE) Liquidity and Solvency

Understanding a bank's financial health requires a close look at its liquidity and solvency. Liquidity refers to the bank's ability to meet its short-term obligations, while solvency indicates its ability to meet long-term obligations. For Carter Bankshares, Inc. (CARE), assessing these aspects involves analyzing key financial ratios and cash flow trends.

Here's an overview of how to assess Carter Bankshares, Inc. (CARE)'s liquidity:

• Current Ratio: The current ratio measures a company's ability to pay off its current liabilities with its current assets. A ratio of 1.0 or greater is generally considered healthy, indicating that the company has enough liquid assets to cover its short-term liabilities.
• Quick Ratio: Also known as the acid-test ratio, the quick ratio is similar to the current ratio but excludes inventories, which are less liquid. This ratio provides a more conservative view of a company's liquidity. A quick ratio of 1.0 or higher is generally preferred.
• Working Capital: Working capital is the difference between a company's current assets and current liabilities. Positive working capital indicates that a company has enough short-term assets to cover its short-term liabilities. Monitoring the trend of working capital can reveal insights into a company's liquidity management.

Analyzing the cash flow statements of Carter Bankshares, Inc. (CARE) provides further insights into its liquidity position. Here's what to consider:

• Operating Cash Flow: This section reflects the cash generated from the company's core business operations. Consistent positive operating cash flow is a sign of a healthy and sustainable business.
• Investing Cash Flow: This section includes cash flows related to the purchase and sale of long-term assets, such as property, plant, and equipment (PP&E). Significant investments in long-term assets may indicate growth initiatives.
• Financing Cash Flow: This section includes cash flows related to debt, equity, and dividends. It provides insights into how the company is funding its operations and returning value to shareholders.

Potential liquidity concerns might arise if Carter Bankshares, Inc. (CARE) exhibits:

• Declining current and quick ratios
• Negative or decreasing operating cash flow
• Increasing reliance on debt financing

Conversely, strengths in liquidity could be indicated by:

• Consistently high current and quick ratios
• Strong and stable operating cash flow
• Prudent management of debt levels

A thorough examination of these factors will provide a comprehensive understanding of Carter Bankshares, Inc. (CARE)'s liquidity position and its ability to meet its short-term obligations.

Here is a brief overview of Carter Bankshares, Inc. (CARE)’s mission, vision, and core values: Mission Statement, Vision, & Core Values of Carter Bankshares, Inc. (CARE).

Carter Bankshares, Inc. (CARE) Valuation Analysis

Assessing whether Carter Bankshares, Inc. (CARE) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance, and analyst sentiment. These factors provide a comprehensive view of the company's current market position.

Key valuation ratios to consider include:

• Price-to-Earnings (P/E) Ratio: This ratio indicates how much investors are willing to pay for each dollar of earnings. A lower P/E ratio might suggest undervaluation, while a higher ratio could indicate overvaluation compared to industry peers.
• Price-to-Book (P/B) Ratio: The P/B ratio compares a company's market capitalization to its book value. A P/B ratio less than 1 could suggest the stock is undervalued.
• Enterprise Value-to-EBITDA (EV/EBITDA): This ratio compares the total value of the company (equity plus net debt) to its earnings before interest, taxes, depreciation, and amortization. It’s useful for evaluating companies with varying capital structures.

Analyzing Carter Bankshares, Inc. (CARE)'s stock price trends over the past year or longer provides insight into market sentiment and company performance. A consistent upward trend may reflect investor confidence, while a downward trend could signal concerns about the company's future prospects. Significant price volatility should also be noted, as it can influence valuation perceptions.

For investors, dividend yield and payout ratios are important, if applicable:

• Dividend Yield: The dividend yield shows how much a company pays out in dividends each year relative to its stock price. A higher yield can be attractive, but it's essential to ensure the dividend is sustainable.
• Payout Ratios: Payout ratios indicate the percentage of earnings paid out as dividends. A high payout ratio may not be sustainable if earnings decline.

Analyst consensus plays a crucial role in valuation assessment. Ratings such as 'buy,' 'hold,' or 'sell' reflect the collective opinion of financial analysts regarding a stock's potential. Understanding the rationale behind these ratings can provide valuable context for investors.

Here's a hypothetical snapshot of valuation metrics for Carter Bankshares, Inc. (CARE), as of fiscal year 2024:

For further insights into Carter Bankshares, Inc. (CARE)'s financial health, you can explore Breaking Down Carter Bankshares, Inc. (CARE) Financial Health: Key Insights for Investors.

Carter Bankshares, Inc. (CARE) Risk Factors

Carter Bankshares, Inc. (CARE) faces a variety of internal and external risks that could significantly impact its financial health. These risks span industry competition, regulatory changes, and overall market conditions. Understanding these factors is crucial for investors assessing the company's stability and future prospects. For more insights, check out: Exploring Carter Bankshares, Inc. (CARE) Investor Profile: Who’s Buying and Why?

Here’s an overview of key risks:

• Industry Competition: The banking sector is highly competitive. Carter Bankshares, Inc. (CARE) competes with other community banks, regional banks, and larger national institutions. Increased competition can pressure the company's ability to attract and retain customers, potentially leading to lower interest rates on loans and higher deposit rates, which can squeeze profit margins.
• Regulatory Changes: Banks are heavily regulated, and changes in regulations can significantly impact Carter Bankshares, Inc. (CARE). These include changes in capital requirements, lending restrictions, and compliance costs. For example, increased regulatory scrutiny may require additional investment in compliance infrastructure, affecting profitability.
• Market Conditions: Economic downturns, interest rate fluctuations, and other market conditions can affect Carter Bankshares, Inc. (CARE). Rising interest rates can reduce demand for loans, while a weakening economy can increase loan defaults, impacting asset quality and profitability.

Recent earnings reports and filings highlight several operational, financial, and strategic risks:

• Credit Risk: The risk that borrowers may default on their loans is a persistent concern. Deteriorating economic conditions can lead to higher default rates, impacting the bank's financial performance.
• Interest Rate Risk: Fluctuations in interest rates can affect the bank's net interest margin (NIM), which is the difference between interest income and interest expense. Changes in interest rates can impact the value of interest-earning assets and interest-bearing liabilities.
• Liquidity Risk: The risk that the bank may not have sufficient cash to meet its obligations. This can arise from unexpected deposit withdrawals or a sudden increase in loan demand.

While specific mitigation strategies may vary, Carter Bankshares, Inc. (CARE) likely employs several common strategies to manage these risks:

• Diversification: Diversifying its loan portfolio across different industries and geographic regions to reduce concentration risk.
• Risk Management Systems: Implementing robust risk management systems to monitor and control various risks, including credit, interest rate, and liquidity risks.
• Capital Adequacy: Maintaining adequate capital levels to absorb potential losses and meet regulatory requirements.
• Compliance Programs: Establishing comprehensive compliance programs to adhere to regulatory requirements and avoid penalties.

Below is a table summarizing key risk categories and potential mitigation strategies:

Carter Bankshares, Inc. (CARE) Growth Opportunities

For investors eyeing Carter Bankshares, Inc. (CARE), understanding its future growth prospects is crucial. Several factors indicate potential avenues for expansion and increased profitability.

Key growth drivers for Carter Bankshares, Inc. (CARE) include:

• Strategic Market Expansion: Identifying and penetrating new geographic markets within its operating footprint could significantly boost Carter Bankshares, Inc.'s (CARE) customer base and overall market share.
• Product Innovation: Introducing new and tailored financial products and services that cater to evolving customer needs can enhance customer loyalty and attract new business.
• Acquisitions: Strategic acquisitions of smaller banks or financial institutions can provide Carter Bankshares, Inc. (CARE) with access to new markets, technologies, or customer segments.

While specific revenue growth projections and earnings estimates for Carter Bankshares, Inc. (CARE) are subject to market conditions and internal performance, analyzing industry trends and company-specific initiatives provides valuable insights. According to the fiscal year 2024 data, Carter Bankshares, Inc. (CARE) reported:

Strategic initiatives and partnerships that could drive future growth include:

• Technology Investments: Embracing digital banking solutions and fintech partnerships can improve operational efficiency, enhance customer experience, and drive revenue growth.
• Community Engagement: Strengthening ties with local communities through sponsorships, philanthropic activities, and financial literacy programs can enhance brand reputation and foster customer loyalty.

Carter Bankshares, Inc.'s (CARE) competitive advantages that position it for growth include:

• Strong Local Presence: With a well-established presence in its operating markets, Carter Bankshares, Inc. (CARE) benefits from strong customer relationships and local market knowledge.
• Experienced Management Team: A capable and experienced management team can effectively navigate challenges, capitalize on opportunities, and drive sustainable growth.
• Sound Financial Position: Maintaining a healthy capital base and strong asset quality provides Carter Bankshares, Inc. (CARE) with the financial flexibility to pursue growth initiatives and withstand economic downturns.

Here is a table summarizing potential growth drivers for Carter Bankshares, Inc. (CARE):

For more insights into Carter Bankshares, Inc. (CARE), check out: Exploring Carter Bankshares, Inc. (CARE) Investor Profile: Who’s Buying and Why?