Critical Comparison: Third Coast Bancshares (NASDAQ:TCBX) vs. Chemung Financial (NASDAQ:CHMG)

Third Coast Bancshares (NASDAQ:TCBX) and Chemung Financial (NASDAQ:CHMG) are both small-cap finance companies, but which is the better business? We will compare the two companies based on the strength of their dividends, institutional ownership, profitability, earnings, analyst recommendations, valuation and risk.

Dividends

Third Coast Bancshares pays an annual dividend of $16.87 per share and has a dividend yield of 41.0%. Chemung Financial pays an annual dividend of $1.36 per share and has a dividend yield of 2.3%. Third Coast Bancshares pays out 445.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Chemung Financial pays out 43.3% of its earnings in the form of a dividend. Chemung Financial has raised its dividend for 1 consecutive years.

Institutional and Insider Ownership

36.9% of Third Coast Bancshares shares are held by institutional investors. Comparatively, 47.5% of Chemung Financial shares are held by institutional investors. 10.3% of Third Coast Bancshares shares are held by insiders. Comparatively, 12.4% of Chemung Financial shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Third Coast Bancshares and Chemung Financial”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Third Coast Bancshares	$207.74 million	3.27	$47.67 million	$3.79	10.87
Chemung Financial	$140.78 million	2.01	$15.10 million	$3.14	18.68

Third Coast Bancshares has higher revenue and earnings than Chemung Financial. Third Coast Bancshares is trading at a lower price-to-earnings ratio than Chemung Financial, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Third Coast Bancshares and Chemung Financial’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Third Coast Bancshares	16.30%	12.05%	1.17%
Chemung Financial	10.73%	11.58%	1.01%

Risk and Volatility

Third Coast Bancshares has a beta of 0.42, suggesting that its stock price is 58% less volatile than the S&P 500. Comparatively, Chemung Financial has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Third Coast Bancshares and Chemung Financial, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Third Coast Bancshares	0	2	3	0	2.60
Chemung Financial	0	4	0	0	2.00

Third Coast Bancshares presently has a consensus price target of $45.33, suggesting a potential upside of 10.08%. Chemung Financial has a consensus price target of $57.00, suggesting a potential downside of 2.83%. Given Third Coast Bancshares’ stronger consensus rating and higher probable upside, equities analysts clearly believe Third Coast Bancshares is more favorable than Chemung Financial.

Summary

Third Coast Bancshares beats Chemung Financial on 11 of the 17 factors compared between the two stocks.

About Third Coast Bancshares

Third Coast Bancshares, Inc. operates as a bank holding company for Third Coast Bank, SSB that provides various commercial banking solutions to small and medium-sized businesses, and professionals. The company's deposit products include checking, savings, individual retirement, and money market accounts, as well as certificates of deposit. It also offers commercial and industrial loans, equipment loans, working capital lines of credit, guaranteed loans, auto finance, letters of credit, commercial and residential real estate, and construction, development, and other loans. In addition, the company provides retail and commercial online banking platforms, mobile banking apps, mortgage, treasury management solutions, merchant card services, and customer digital solutions, as well as debit and credit cards. Third Coast Bancshares, Inc. was founded in 2008 and is headquartered in Humble, Texas.

About Chemung Financial

Chemung Financial Corporation operates as a bank holding company for Chemung Canal Trust Company that provides a range of banking, financing, fiduciary, and other financial services. The company provides demand, savings, and time deposits; non-interest and interest-bearing checking accounts; and insured money market accounts. It also offers commercial and agricultural loans comprising loans to small to mid-sized businesses; commercial and residential mortgage loans; and consumer loans, including home equity lines of credit and home equity term loans. In addition, the company provides interest rate swaps, letters of credit, employee benefit plans, insurance products, mutual fund, brokerage, and tax preparation services. Further, it offers guardian, custodian, trustee, investment, pension, estate planning, and employee benefit administrative services, as well as acts as an agent for pension, profit-sharing, and other employee benefit trusts. Chemung Financial Corporation was founded in 1833 and is headquartered in Elmira, New York.