Overview

* Carter Bankshares ( CARE ) Q3 net income and EPS miss analyst expectations

* Net interest income for Q3 increased 4.2% from prior quarter

* Company's financial results impacted by nonaccrual loans from Justice Entities

Outlook

* Company expects to benefit from Federal Reserve's short-term interest rate reductions

* Company anticipates loan growth from prior construction lending over next 12-18 months

* Carter Bankshares ( CARE ) aims to resolve large nonperforming credit relationship

Result Drivers

* NONACCRUAL LOANS - Financial results significantly impacted by nonaccrual loans from Justice Entities, affecting interest income by $6.5 mln in Q3

* LOAN GROWTH - Total portfolio loans increased by $88.5 mln, driven by commercial real estate and construction lending

* NET INTEREST INCOME - Increased by $1.4 mln due to a decline in funding costs and higher average loan balances

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q3 EPS Miss $0.24 $0.41 (3

Analysts

)

Q3 Net Miss $5.41 $9.28

Income mln mln (2

Analysts

)

Q3 Net $33.71

Interest mln

Income

Q3 Miss $7.15 $12.50

Pretax mln mln (1

Profit Analyst)

Q3 Basic $0.24

EPS

Analyst Coverage

* The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 3 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

* The average consensus recommendation for the banks peer group is "buy"

* Wall Street's median 12-month price target for Carter Bankshares Inc ( CARE ) is $23.25, about 18.2% above its October 21 closing price of $19.01

* The stock recently traded at 10 times the next 12-month earnings vs. a P/E of 9 three months ago

Press Release:

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)