ConnectOne Bancorp (NASDAQ: CNOB) and Lakeland Financial Corporation (NASDAQ:LKFN) are both small-cap finance companies, but which is the superior investment? We will contrast the two businesses based on the strength of their profitability, risk, dividends, valuation, analyst recommendations, earnings and institutional ownership.
Institutional & Insider Ownership
68.4% of ConnectOne Bancorp shares are held by institutional investors. Comparatively, 69.3% of Lakeland Financial Corporation shares are held by institutional investors. 7.6% of ConnectOne Bancorp shares are held by insiders. Comparatively, 5.0% of Lakeland Financial Corporation 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.
Valuation & Earnings
This table compares ConnectOne Bancorp and Lakeland Financial Corporation’s gross revenue, earnings per share (EPS) and valuation.
Lakeland Financial Corporation has higher revenue and earnings than ConnectOne Bancorp. Lakeland Financial Corporation is trading at a lower price-to-earnings ratio than ConnectOne Bancorp, indicating that it is currently the more affordable of the two stocks.
This is a summary of recent ratings and price targets for ConnectOne Bancorp and Lakeland Financial Corporation, as provided by MarketBeat.
ConnectOne Bancorp currently has a consensus target price of $29.25, indicating a potential upside of 16.30%. Lakeland Financial Corporation has a consensus target price of $46.00, indicating a potential downside of 5.25%. Given ConnectOne Bancorp’s stronger consensus rating and higher probable upside, equities research analysts plainly believe ConnectOne Bancorp is more favorable than Lakeland Financial Corporation.
Volatility and Risk
ConnectOne Bancorp has a beta of 0.97, suggesting that its stock price is 3% less volatile than the S&P 500. Comparatively, Lakeland Financial Corporation has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500.
This table compares ConnectOne Bancorp and Lakeland Financial Corporation’s net margins, return on equity and return on assets.
ConnectOne Bancorp pays an annual dividend of $0.30 per share and has a dividend yield of 1.2%. Lakeland Financial Corporation pays an annual dividend of $0.88 per share and has a dividend yield of 1.8%. ConnectOne Bancorp pays out 32.3% of its earnings in the form of a dividend. Lakeland Financial Corporation pays out 39.5% 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.
Lakeland Financial Corporation beats ConnectOne Bancorp on 9 of the 16 factors compared between the two stocks.
ConnectOne Bancorp Company Profile
ConnectOne Bancorp, Inc. is a bank holding company of ConnectOne Bank (the Bank). The Bank is a community-based, full-service New Jersey-chartered commercial bank. The Bank offers a range of deposit and loan products. In addition, to attract the business of consumer and business customers, it also provides an array of other banking services. Products and services provided include personal and business checking accounts, retirement accounts, money market accounts, time and savings accounts, credit cards, wire transfers, access to automated teller services, Internet banking, Treasury Direct, automated clearing house (ACH) origination, lockbox services and mobile banking by phone. In addition, it offers safe deposit boxes. The Bank also offers remote deposit capture banking for both retail and business customers. It offers a range of deposit and loan products and services to the general public and, in particular, to small and mid-sized businesses, local professionals and individuals.
Lakeland Financial Corporation Company Profile
Lakeland Financial Corporation is a bank holding company. The Company, through its subsidiary, Lake City Bank (the Bank), provides an array of products and services throughout its Northern and Central Indiana markets. It offers commercial and consumer banking services, as well as trust and wealth management, brokerage, investment and treasury management commercial services. It serves a range of industries, including commercial real estate, manufacturing, agriculture, construction, retail, wholesale, finance and insurance, accommodation and food services, and healthcare. The Bank’s activities cover all phases of commercial banking, including deposit products, commercial and consumer lending, retail and merchant credit card services, corporate treasury management services, and wealth advisory, trust and brokerage services. It provides financial services through the Bank, with approximately 50 branch offices in 15 counties in Northern and Central Indiana.