Head-To-Head Review: ConnectOne Bancorp (NASDAQ:CNOB) & Midland States Bancorp (NASDAQ:MSBI)

ConnectOne Bancorp (NASDAQ:CNOBGet Rating) and Midland States Bancorp (NASDAQ:MSBIGet Rating) are both small-cap finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, profitability, institutional ownership, dividends, valuation and risk.

Institutional & Insider Ownership

67.8% of ConnectOne Bancorp shares are held by institutional investors. Comparatively, 58.5% of Midland States Bancorp shares are held by institutional investors. 6.6% of ConnectOne Bancorp shares are held by insiders. Comparatively, 5.8% of Midland States Bancorp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk & Volatility

ConnectOne Bancorp has a beta of 1.25, suggesting that its stock price is 25% more volatile than the S&P 500. Comparatively, Midland States Bancorp has a beta of 0.91, suggesting that its stock price is 9% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for ConnectOne Bancorp and Midland States Bancorp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ConnectOne Bancorp 0 0 2 0 3.00
Midland States Bancorp 0 1 0 0 2.00

ConnectOne Bancorp presently has a consensus price target of $30.00, suggesting a potential upside of 10.33%. Midland States Bancorp has a consensus price target of $28.00, suggesting a potential upside of 5.22%. Given ConnectOne Bancorp’s stronger consensus rating and higher possible upside, research analysts plainly believe ConnectOne Bancorp is more favorable than Midland States Bancorp.

Profitability

This table compares ConnectOne Bancorp and Midland States Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ConnectOne Bancorp 38.52% 12.77% 1.58%
Midland States Bancorp 26.75% 13.43% 1.21%

Dividends

ConnectOne Bancorp pays an annual dividend of $0.62 per share and has a dividend yield of 2.3%. Midland States Bancorp pays an annual dividend of $1.16 per share and has a dividend yield of 4.4%. ConnectOne Bancorp pays out 19.9% of its earnings in the form of a dividend. Midland States Bancorp pays out 30.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. ConnectOne Bancorp has raised its dividend for 2 consecutive years and Midland States Bancorp has raised its dividend for 6 consecutive years. Midland States Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares ConnectOne Bancorp and Midland States Bancorp’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
ConnectOne Bancorp $317.43 million 3.39 $130.35 million $3.12 8.71
Midland States Bancorp $307.72 million 1.91 $81.32 million $3.77 7.06

ConnectOne Bancorp has higher revenue and earnings than Midland States Bancorp. Midland States Bancorp is trading at a lower price-to-earnings ratio than ConnectOne Bancorp, indicating that it is currently the more affordable of the two stocks.

Summary

ConnectOne Bancorp beats Midland States Bancorp on 13 of the 17 factors compared between the two stocks.

About ConnectOne Bancorp

(Get Rating)

ConnectOne Bancorp, Inc. operates as the bank holding company for ConnectOne Bank that provides commercial banking products and services for small and mid-sized businesses, local professionals, and individuals in the Northern New Jersey and New York Metropolitan area, and South Florida market. The company offers personal and business checking, retirement, money market, and time and savings accounts. It also provides consumer and commercial business loans on a secured and unsecured basis; revolving lines of credit; commercial mortgage loans; residential mortgages on primary and secondary residences; home equity loans; bridge loans; other personal purpose loans; and commercial construction and real estate loans. In addition, the company offers check cards, ATM cards, credit cards, wire transfers, access to automated teller services, Internet banking, treasury direct, automated clearing house origination, mobile banking by phone, safe deposit boxes, and remote deposit capture services. It operates through a network of eight banking offices in Bergen County, five banking offices in Union County, one banking office in Morris County, one office in Essex County, one office in Hudson County, one office in Monmouth County, one banking office in Manhattan in New York City, one office in Nassau County on Long Island, one in Astoria, and five branches in the Hudson Valley, as well as one financial center in West Palm Beach in Palm Beach County. The company was formerly known as Center Bancorp, Inc. and changed its name to ConnectOne Bancorp, Inc. in July 2014. ConnectOne Bancorp, Inc. was incorporated in 1982 and is headquartered in Englewood Cliffs, New Jersey.

About Midland States Bancorp

(Get Rating)

Midland States Bancorp, Inc. operates as a financial holding company for Midland States Bank that provides various banking products and services to individuals, businesses, municipalities, and other entities. It operates through Banking, Wealth Management, and Other segments. The company accepts various deposits, such as checking, savings, money market, and sweep accounts, as well as certificates of deposits. It also offers term loans to purchase capital equipment; lines of credit for working capital and operational purposes; commercial real estate loans for owner occupied and non-owner occupied commercial property, as well as farmland loans; construction and land development loans developers of commercial real estate investment properties, residential developments, individual clients for construction of single family homes, as well as to construct owner-user properties; and residential real estate loans and home equity lines of credit.. In addition, the company provides consumer installment loans for the purchase of cars, boats, and other recreational vehicles, as well as for the purchase of major appliances and other home improvement projects; commercial equipment leasing; and trust and wealth management products and services, including financial and estate planning, trustee and custodial services, investment management, tax and insurance planning, business planning, corporate retirement plan consulting and administration, and retail brokerage services. As of December 31, 2021, it operated 52 full-service banking offices. The company was founded in 1881 and is headquartered in Effingham, Illinois.

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