Reviewing Prime Meridian (OTCMKTS:PMHG) & Third Coast Bancshares (NASDAQ:TCBX)

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

Valuation and Earnings

This table compares Prime Meridian and Third Coast Bancshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Prime Meridian	$50.36 million	3.32	$8.49 million	$2.48	19.98
Third Coast Bancshares	$338.98 million	1.48	$47.67 million	$3.27	11.08

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

Profitability

This table compares Prime Meridian and Third Coast Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Prime Meridian	15.55%	9.35%	0.88%
Third Coast Bancshares	16.30%	12.05%	1.17%

Risk & Volatility

Prime Meridian has a beta of 0.17, meaning that its share price is 83% less volatile than the S&P 500. Comparatively, Third Coast Bancshares has a beta of 0.41, meaning that its share price is 59% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Prime Meridian and Third Coast Bancshares, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Prime Meridian	0	0	0	0	0.00
Third Coast Bancshares	0	2	1	0	2.33

Third Coast Bancshares has a consensus target price of $40.00, suggesting a potential upside of 10.44%. Given Third Coast Bancshares’ stronger consensus rating and higher probable upside, analysts plainly believe Third Coast Bancshares is more favorable than Prime Meridian.

Insider & Institutional Ownership

11.8% of Prime Meridian shares are owned by institutional investors. Comparatively, 36.9% of Third Coast Bancshares shares are owned by institutional investors. 25.9% of Prime Meridian shares are owned by company insiders. Comparatively, 10.3% of Third Coast Bancshares shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Third Coast Bancshares beats Prime Meridian on 11 of the 14 factors compared between the two stocks.

About Prime Meridian

Prime Meridian Holding Company operates as the bank holding company for Prime Meridian Bank that provides various consumer and commercial banking services to individuals and businesses. The company accepts various deposits, such as checking, money market, savings, term certificate of deposit, demand interest-bearing and noninterest-bearing, health savings, NOW, and escrow accounts, as well as retirement savings plans and time deposits. Its loan products include commercial real estate, residential real estate and home equity, small business administration, construction, equipment, and commercial loans; and consumer and other loans comprising financing of automobiles, boats, and recreational vehicles, as well as issues standby letters and business lines of credit. The company also offers debit and credit cards; mobile banking, remote and mobile deposit, Apple Pay, bank-to-bank transfer, and online banking services; and safe deposit, wire transfer, foreign exchange, direct deposits, notary, night depository, official checks, domestic collections, bank drafts, automated teller services, drive-in tellers, merchant card, and banking by mail services, as well as invests in securities. Prime Meridian Holding Company was founded in 2008 and is headquartered in Tallahassee, Florida.

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.