Analyzing ConnectOne Bancorp (NASDAQ:CNOB) & First Bancorp, Inc (ME) (NASDAQ:FNLC)

ConnectOne Bancorp (NASDAQ:CNOB) and First Bancorp, Inc (ME) (NASDAQ:FNLC) are both small-cap finance companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, earnings, risk, analyst recommendations, institutional ownership, dividends and valuation.

Valuation and Earnings

This table compares ConnectOne Bancorp and First Bancorp, Inc (ME)”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ConnectOne Bancorp	$461.10 million	3.53	$80.44 million	$3.05	10.61
First Bancorp, Inc (ME)	$177.61 million	2.22	$34.39 million	$3.37	10.38

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

Dividends

ConnectOne Bancorp pays an annual dividend of $0.78 per share and has a dividend yield of 2.4%. First Bancorp, Inc (ME) pays an annual dividend of $1.52 per share and has a dividend yield of 4.3%. ConnectOne Bancorp pays out 25.6% of its earnings in the form of a dividend. First Bancorp, Inc (ME) pays out 45.1% 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 increased its dividend for 4 consecutive years and First Bancorp, Inc (ME) has increased its dividend for 6 consecutive years. First Bancorp, Inc (ME) is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for ConnectOne Bancorp and First Bancorp, Inc (ME), as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ConnectOne Bancorp	0	1	4	0	2.80
First Bancorp, Inc (ME)	0	0	1	0	3.00

ConnectOne Bancorp presently has a consensus target price of $35.00, suggesting a potential upside of 8.16%. Given ConnectOne Bancorp’s higher possible upside, research analysts clearly believe ConnectOne Bancorp is more favorable than First Bancorp, Inc (ME).

Institutional and Insider Ownership

67.7% of ConnectOne Bancorp shares are owned by institutional investors. Comparatively, 40.4% of First Bancorp, Inc (ME) shares are owned by institutional investors. 5.2% of ConnectOne Bancorp shares are owned by insiders. Comparatively, 5.1% of First Bancorp, Inc (ME) shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

ConnectOne Bancorp has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500. Comparatively, First Bancorp, Inc (ME) has a beta of 0.5, meaning that its stock price is 50% less volatile than the S&P 500.

Profitability

This table compares ConnectOne Bancorp and First Bancorp, Inc (ME)’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ConnectOne Bancorp	20.21%	11.35%	1.17%
First Bancorp, Inc (ME)	21.43%	13.43%	1.19%

Summary

ConnectOne Bancorp beats First Bancorp, Inc (ME) on 10 of the 17 factors compared between the two stocks.

About ConnectOne Bancorp

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 New York Metropolitan area and South Florida market. The company offers personal and business checking, money market, and time and savings accounts; credit cards, wire transfers, safe deposit boxes, automated teller services and telephone, and internet and mobile banking. It provides retirement accounts, consumers and cash management services for business clients, including treasury direct, automated clearing house, remote deposit capture, and digital invoicing. In addition, the company offers consumer and commercial business loans, including lines of credit, commercial and residential mortgages, home equity and bridge loans, and other personal loans; commercial loans secured by collateral, such as business assets comprising accounts receivable, inventory and equipment, and mortgages filed on commercial and residential real estate, as well as cash balances and marketable securities. Further, it provides real estate loans, which includes loans secured by first liens on completed commercial properties, including multi-family properties, to purchase or refinance properties; residential mortgages, such as loans secured by first liens on 1-4 family and condominium; and cooperative residential real estate loans. 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 First Bancorp, Inc (ME)

The First Bancorp, Inc. operates as the holding company for First National Bank that provides a range of banking products and services to individuals and businesses. It offers various deposit products, including demand, NOW, time, savings, money market, and certificates of deposit accounts. The company also provides commercial loans comprising commercial real estate owner occupied, such as mortgage loans to finance investments in real property such as retail space, offices, industrial buildings, hotels, educational facilities, and other specific or mixed use properties; commercial real estate non-owner occupied loans; commercial construction to finance construction in a mix of owner- and nonowner occupied commercial real estate properties; and commercial and industrial loans, including revolving and term loan for financing working capital and/or capital investment. In addition, it offers commercial multifamily loans; residential real estate term and residential real estate construction loans; loans to municipalities in Maine for capitalized expenditures, construction projects, or tax anticipation notes; home equity revolving and term loans; and personal lines of credit and amortizing loans for various purposes, such as autos, recreational vehicles, debt consolidation, personal expenses, or overdraft protection. Further, the company offers private banking, financial planning, investment management, and trust services to individuals, businesses, non-profit organizations and municipalities; and brokerage, annuity, and various insurance products, as well as payment processing services. It operates through full-service banking offices in Lincoln, Knox, Waldo, Penobscot, Hancock, and Washington counties in the Mid-Coast, Eastern, and Down East regions of Maine. The company was formerly known as First National Lincoln Corporation and changed its name to The First Bancorp, Inc. in April 2008. The First Bancorp, Inc. was founded in 1864 and is based in Damariscotta, Maine.