Reviewing ConnectOne Bancorp (NASDAQ:CNOB) and Union Bankshares (NASDAQ:UNB)

ConnectOne Bancorp (NASDAQ:CNOB) and Union Bankshares (NASDAQ:UNB) are both small-cap finance companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, analyst recommendations, risk, valuation and dividends.

Risk and Volatility

ConnectOne Bancorp has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500. Comparatively, Union Bankshares has a beta of 0.29, suggesting that its stock price is 71% less volatile than the S&P 500.

Profitability

This table compares ConnectOne Bancorp and Union Bankshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ConnectOne Bancorp	18.97%	11.96%	1.25%
Union Bankshares	12.68%	14.82%	0.78%

Analyst Ratings

This is a summary of current recommendations for ConnectOne Bancorp and Union Bankshares, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ConnectOne Bancorp	0	0	5	0	3.00
Union Bankshares	0	1	0	0	2.00

ConnectOne Bancorp currently has a consensus target price of $35.75, indicating a potential upside of 9.23%. Given ConnectOne Bancorp’s stronger consensus rating and higher possible upside, equities analysts clearly believe ConnectOne Bancorp is more favorable than Union Bankshares.

Earnings & Valuation

This table compares ConnectOne Bancorp and Union Bankshares”s top-line 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	2.42	$80.44 million	$2.86	11.44
Union Bankshares	$57.36 million	1.96	$11.08 million	$2.63	8.66

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

Institutional & Insider Ownership

67.7% of ConnectOne Bancorp shares are owned by institutional investors. Comparatively, 14.8% of Union Bankshares shares are owned by institutional investors. 5.2% of ConnectOne Bancorp shares are owned by company insiders. Comparatively, 2.1% of Union Bankshares shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

ConnectOne Bancorp pays an annual dividend of $0.78 per share and has a dividend yield of 2.4%. Union Bankshares pays an annual dividend of $1.44 per share and has a dividend yield of 6.3%. ConnectOne Bancorp pays out 27.3% of its earnings in the form of a dividend. Union Bankshares pays out 54.8% 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 4 consecutive years.

Summary

ConnectOne Bancorp beats Union Bankshares on 15 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 Union Bankshares

Union Bankshares, Inc. operates as the bank holding company for Union Bank that provides retail, commercial, and municipal banking products and services in northern Vermont and New Hampshire. It offers retail depository services, such as personal checking, savings, money market, IRA/SEP/KEOGH, and health savings accounts, as well as certificates of deposit. The company also provides commercial real estate loans; commercial loans for plant and equipment, working capital, real estate renovation, and other business purposes to business owners and investors; small business administration guaranteed loans; residential construction and mortgage loans; municipal financing, including loans and excess deposits secured by FHLBB letters of credit; and home improvement loans and overdraft checking privileges against preauthorized lines of credit. In addition, it offers online cash management services, including account reconciliation, credit card depository, automated clearing house origination, wire transfers, positive pay and night depository services; merchant credit card services for the deposit and immediate credit of sales drafts; remote deposit capture services; and online mortgage application and consumer deposit account opening services. Further, the company provides business checking accounts; standby letters of credit, bank checks or money orders, and safe deposit boxes; ATM cards and services; debit cards; telephone, internet, and mobile banking services, including bill pay; and wealth management, fiduciary, and trust services. It offers retail banking services to individuals; and commercial banking services to small and medium sized business corporations, limited liability companies, partnerships, and sole proprietorships, as well as nonprofit organizations, local municipalities, and school districts. Union Bankshares, Inc. was founded in 1891 and is headquartered in Morrisville, Vermont.