ConnectOne Bancorp (NASDAQ:CNOB) vs. First Interstate BancSystem (NASDAQ:FIBK) Head to Head Review

First Interstate BancSystem (NASDAQ:FIBK) and ConnectOne Bancorp (NASDAQ:CNOB) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, analyst recommendations, risk, earnings and profitability.

Dividends

First Interstate BancSystem pays an annual dividend of $1.88 per share and has a dividend yield of 5.4%. ConnectOne Bancorp pays an annual dividend of $0.72 per share and has a dividend yield of 2.6%. First Interstate BancSystem pays out 82.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. ConnectOne Bancorp pays out 41.4% of its earnings in the form of a dividend. First Interstate BancSystem has increased its dividend for 11 consecutive years. First Interstate BancSystem is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares First Interstate BancSystem and ConnectOne Bancorp”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
First Interstate BancSystem	$1.43 billion	2.56	$257.50 million	$2.28	15.31
ConnectOne Bancorp	$504.07 million	2.09	$87.00 million	$1.74	15.75

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

Analyst Recommendations

This is a summary of recent ratings for First Interstate BancSystem and ConnectOne Bancorp, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
First Interstate BancSystem	2	1	3	0	2.17
ConnectOne Bancorp	0	1	1	1	3.00

First Interstate BancSystem presently has a consensus target price of $33.83, suggesting a potential downside of 3.08%. ConnectOne Bancorp has a consensus target price of $26.33, suggesting a potential downside of 3.93%. Given First Interstate BancSystem’s higher probable upside, research analysts plainly believe First Interstate BancSystem is more favorable than ConnectOne Bancorp.

Profitability

This table compares First Interstate BancSystem and ConnectOne Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
First Interstate BancSystem	15.94%	7.48%	0.81%
ConnectOne Bancorp	13.56%	6.71%	0.76%

Volatility and Risk

First Interstate BancSystem has a beta of 0.84, meaning that its stock price is 16% less volatile than the S&P 500. Comparatively, ConnectOne Bancorp has a beta of 1.27, meaning that its stock price is 27% more volatile than the S&P 500.

Institutional & Insider Ownership

88.7% of First Interstate BancSystem shares are owned by institutional investors. Comparatively, 67.7% of ConnectOne Bancorp shares are owned by institutional investors. 6.9% of First Interstate BancSystem shares are owned by insiders. Comparatively, 6.4% of ConnectOne Bancorp shares are owned by 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

First Interstate BancSystem beats ConnectOne Bancorp on 13 of the 18 factors compared between the two stocks.

About First Interstate BancSystem

First Interstate BancSystem, Inc. operates as the bank holding company for First Interstate Bank that provides range of banking products and services in the United States. It offers various traditional depository products, including checking, savings, and time deposits; and repurchase agreements primarily for commercial and municipal depositors. The company also offers real estate loans comprising commercial real estate, construction, residential, agricultural, and other real estate loans; consumer loans comprising direct personal loans, credit card loans and lines of credit, and indirect loans; variable and fixed rate commercial loans for small and medium-sized manufacturing, wholesale, retail, and service businesses for working capital needs and business expansions; and agricultural loans. In addition, it provides a range of trust, employee benefit, investment management, insurance, agency, and custodial services to individuals, businesses, and nonprofit organizations. Further, the company offers marketing, credit review, loan servicing, credit cards issuance and servicing, mortgage loan sales and servicing, indirect consumer loan purchasing and processing, loan collection services, other operational, and specialized staff support services, as well as online and mobile banking services. The company serves individuals, businesses, municipalities, and other entities in various industries, including agriculture, construction, education, governmental services, healthcare, hospitality, housing, professional services, real estate development, retail, technology, tourism, and wholesale trade. First Interstate BancSystem, Inc. was incorporated in 1971 and is headquartered in Billings, Montana.

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.