Reviewing ConnectOne Bancorp (NASDAQ:CNOB) & Trustmark (NASDAQ:TRMK)

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

Dividends

ConnectOne Bancorp pays an annual dividend of $0.78 per share and has a dividend yield of 2.5%. Trustmark pays an annual dividend of $1.00 per share and has a dividend yield of 2.2%. ConnectOne Bancorp pays out 25.6% of its earnings in the form of a dividend. Trustmark pays out 25.4% 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 Trustmark has increased its dividend for 1 consecutive years. ConnectOne Bancorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

67.7% of ConnectOne Bancorp shares are owned by institutional investors. Comparatively, 67.6% of Trustmark shares are owned by institutional investors. 5.2% of ConnectOne Bancorp shares are owned by insiders. Comparatively, 1.7% of Trustmark shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
ConnectOne Bancorp	20.21%	11.24%	1.17%
Trustmark	20.75%	10.69%	1.20%

Analyst Recommendations

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

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ConnectOne Bancorp	0	1	4	0	2.80
Trustmark	0	4	1	1	2.50

ConnectOne Bancorp currently has a consensus price target of $35.00, indicating a potential upside of 13.71%. Trustmark has a consensus price target of $47.38, indicating a potential upside of 3.15%. Given ConnectOne Bancorp’s stronger consensus rating and higher probable upside, equities research analysts plainly believe ConnectOne Bancorp is more favorable than Trustmark.

Risk & Volatility

ConnectOne Bancorp has a beta of 1.08, suggesting that its stock price is 8% more volatile than the S&P 500. Comparatively, Trustmark has a beta of 0.66, suggesting that its stock price is 34% less volatile than the S&P 500.

Earnings & Valuation

This table compares ConnectOne Bancorp and Trustmark”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ConnectOne Bancorp	$679.93 million	2.28	$80.44 million	$3.05	10.09
Trustmark	$1.12 billion	2.37	$224.13 million	$3.94	11.66

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

Trustmark Corporation operates as the bank holding company for Trustmark National Bank that provides banking and other financial solutions to individuals and corporate institutions in the United States. The company operates through three segments: General Banking, Wealth Management, and Insurance. It offers checking, savings, and money market accounts; certificates of deposits and individual retirement accounts; financing for commercial and industrial projects, income-producing commercial real estate, owner-occupied real estate, and construction and land development; and installment and real estate loans, and lines of credit, as well as treasury management services. The company also provides mortgage banking services, including construction financing, production of conventional and government-insured mortgages, and secondary marketing and mortgage servicing. In addition, it provides wealth management and trust services, such as administration of personal trusts and estates; management of investment accounts for individuals, employee benefit plans, and charitable foundations; and corporate trust and institutional custody, securities brokerage, financial and estate planning, retirement plan, and investment management services. Further, the company offers business insurance products and services for medical professionals, construction, manufacturing, hospitality, real estate, and group life and health plans; and life and health insurance, and personal line policies for individual customers. Trustmark Corporation was founded in 1889 and is headquartered in Jackson, Mississippi.