Nasdaq:CARE
Carter Bankshares, Inc.
A regional bank focused on serving the Texas and Oklahoma markets with a diversified mix of lending, deposit gathering, and wealth management services.
Key Metrics
Investment Thesis
Bull Case
Carter Bankshares is attractive for investors seeking exposure to the resilient regional banking sector with a clear path to revenue expansion as seen in the recent upward trend from 2023 levels. The company's ability to generate positive operating profit and return capital through share repurchases suggests a mature management team focused on shareholder value.
Bear Case
Investors should exercise caution due to the significant retained earnings deficit of $365.0M, which indicates historical losses or heavy dividend payments that may constrain future flexibility. The substantial cash outflow for investing activities of $155.9M coupled with high operating expenses relative to revenue could limit growth potential in a tightening credit environment.
About Carter Bankshares, Inc.
Carter Bankshares, Inc. operates as a diversified financial holding company providing commercial banking services to individuals, small businesses, and corporations primarily in Texas and Oklahoma. The firm generates revenue through net interest income on loans and deposits, fee-based wealth management, and investment securities trading within the regional banking sector.
Analysis
Management Discussion
The company reported a 2025 revenue of $20.3M, reflecting a recovery trend following declines in 2023 and 2024, while net income grew to $31.4M driven by improved operating profitability of $40.0M. Strong cash flow from operations of $39.9M and significant financing inflows of $90.0M indicate robust liquidity management despite a net decrease in cash of $26.0M due to investing outflows.
Industry Overview
The regional banking industry is currently navigating a landscape defined by interest rate normalization and the need to balance loan growth against deposit costs. Companies like Carter Bankshares must maintain strict capital ratios while adapting to changing consumer preferences toward digital banking and fee-based services.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $19.1M | $17.3M | $19.4M | $20.3M |
| Cost of Revenue | $0 | $0 | $0 | $0 |
| Gross Profit | $19.1M | $17.3M | $19.4M | $20.3M |
| Operating Expenses | $-42.6M | $-11.5M | $-11.5M | $-19.7M |
| Operating Income | $61.7M | $28.7M | $30.9M | $40.0M |
| Stock-Based Comp | $1.3M | $1.6M | $1.8M | $2.1M |
| D&A | $6.1M | $6.2M | $7.1M | $7.9M |
| Depreciation | $6.1M | $6.2M | $7.1M | $7.9M |
| Amortization | — | — | — | $161.0K |
| Non-Operating Income | $0 | $0 | $0 | $0 |
| Interest Expense | $20.3M | $74.1M | — | — |
| Pre-Tax Income | $61.7M | $28.7M | $30.9M | $40.0M |
| Income Tax | $11.6M | $5.3M | $6.3M | $8.6M |
| Continuing Ops | $50.1M | $23.4M | $24.5M | $31.4M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $50.1M | $23.4M | $24.5M | $31.4M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $50.1M | $23.4M | $24.5M | $31.4M |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| PP&E (Net) | $72.1M | $73.7M | $74.3M | $72.5M |
| Goodwill | — | — | — | $1.2M |
| Operating Leases | $6.3M | $419.0K | $294.0K | $1.1M |
| Total Assets | $4.20B | $4.51B | $4.66B | $4.85B |
| Total Liabilities | $3.88B | $4.16B | $4.27B | $4.43B |
| Shareholders' Equity | $328.6M | $351.2M | $384.3M | $419.7M |
| Paid-In Capital | $104.7M | $90.6M | $92.2M | $74.8M |
| Retained Earnings | $285.6M | $309.1M | $333.6M | $365.0M |
| AOCI | $-85.6M | $-71.4M | $-64.5M | $-42.2M |
| Total L&E | $4.20B | $4.51B | $4.66B | $4.85B |
| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Net Income (CFO) | $50.1M | $23.4M | $24.5M | $31.4M |
| Non-Cash Adjustments | $17.1M | $232.0M | $-81.3M | $-17.0M |
| Working Capital Changes | $3.6M | $-208.6M | $93.7M | $25.5M |
| Cash from Operations | $70.8M | $46.7M | $36.9M | $39.9M |
| Capital Expenditures | $5.9M | $9.8M | $8.1M | $8.1M |
| Cash from Investing | $-382.1M | $-307.0M | $-68.4M | $-155.9M |
| Share Buybacks | $42.9M | $16.4M | $0 | $20.0M |
| Dividends Paid | $0 | — | — | — |
| Cash from Financing | $80.3M | $267.9M | $108.1M | $90.0M |
| FX Effect | $0 | $0 | $0 | $0 |
| Net Change in Cash | $-230.9M | $7.7M | $76.6M | $-26.0M |
| Beginning Cash | $277.8M | $46.9M | $54.5M | $131.2M |
| Ending Cash | $46.9M | $54.5M | $131.2M | $105.2M |
Frequently Asked Questions
How does Carter Bankshares, Inc. make money?
Commercial Banking Lending providing loans to small and mid-sized businesses; Retail Banking offering checking and savings accounts to individuals; Wealth Management delivering investment advisory and fiduciary services; Securities Trading generating returns from trading marketable securities and managing asset portfolios.
What are the main risks for CARE?
Regulatory headwinds and compliance costs increasing operating expenses; Interest rate volatility impacting net interest margins and loan demand; Credit quality deterioration from regional economic downturns affecting loan loss provisions; Competition from larger national banks eroding market share in deposit gathering.
What is CARE's competitive advantage?
Deep roots in the Texas and Oklahoma markets fostering strong customer relationships; Diversified revenue streams across lending, fees, and investments providing stability; Capitalized balance sheet allowing flexibility for acquisitions and organic growth.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.