Head to Head Analysis: Third Coast Bancshares (NASDAQ:TCBX) and Truxton (OTCMKTS:TRUX)

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

Valuation & Earnings

This table compares Third Coast Bancshares and Truxton”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	$219.24 million	2.87	$47.67 million	$3.89	9.75
Truxton	$92.29 million	3.01	$21.48 million	$8.04	11.94

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

Dividends

Third Coast Bancshares pays an annual dividend of $16.87 per share and has a dividend yield of 44.5%. Truxton pays an annual dividend of $3.52 per share and has a dividend yield of 3.7%. Third Coast Bancshares pays out 433.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Truxton pays out 43.8% of its earnings in the form of a dividend.

Analyst Ratings

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Third Coast Bancshares	0	2	3	0	2.60
Truxton	0	0	0	0	0.00

Third Coast Bancshares presently has a consensus price target of $45.00, suggesting a potential upside of 18.63%. Given Third Coast Bancshares’ stronger consensus rating and higher probable upside, analysts plainly believe Third Coast Bancshares is more favorable than Truxton.

Profitability

This table compares Third Coast Bancshares and Truxton’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%
Truxton	24.00%	N/A	N/A

Institutional and Insider Ownership

36.9% of Third Coast Bancshares shares are held by institutional investors. Comparatively, 0.3% of Truxton shares are held by institutional investors. 10.3% of Third Coast Bancshares shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Third Coast Bancshares has a beta of 0.34, meaning that its share price is 66% less volatile than the S&P 500. Comparatively, Truxton has a beta of 0.56, meaning that its share price is 44% less volatile than the S&P 500.

Summary

Third Coast Bancshares beats Truxton on 10 of the 16 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 Truxton

Truxton Corporation, through its subsidiaries, provides various banking, investment management, and trust administration services to individuals, businesses, and charitable institutions in the United States. The company offers deposit products, including demand, money market accounts, and certificates of deposit. It also provides lending products, such as residential and commercial real estate mortgages, commercial loans, construction and land development loans, commercial and industrial loans, operating lines of credit, and loans to individual. In addition, the company offers strategic and capital advisory services, business banking, and treasury management services; and insurance products. The company was formerly known as NBT Holdings Inc. and changed its name to Truxton Corporation in May 2013. Truxton Corporation was founded in 2004 and is based in Nashville, Tennessee.