ConnectOne Bancorp heads into the first week of July with a fresh analyst downgrade landing just as the stock trades within striking distance of the Street's consensus target.
The downgrade is the most interesting development this week. Raymond James cut CNOB from Strong Buy to Market Perform on July 1, a meaningful step back from what had been one of the more bullish stances on the stock. The move arrives after a strong run — shares are up 11% over the past month to $33.44, and Piper Sandler raised its target to $38 just days earlier on June 26, maintaining Overweight. The two moves together capture the tension on the Street right now: bulls see room to $38 given the bank's earnings trajectory, while Raymond James appears to be calling the near-term upside largely realised. The consensus mean target of $34.60 now sits only 3.5% above the current price, leaving little buffer for fresh long entries.
Positioning in the lending market offers little drama to complicate that picture. Short interest is modest at 3.2% of free float — roughly 1.6 million shares — and has actually edged lower over the past week, down about 2.3%. Borrow availability is exceptionally loose at 2,674%, meaning there are far more shares available to lend than are currently borrowed. Cost to borrow has ticked up 22% on the week to 0.59%, but in absolute terms that remains a near-zero rate with no squeeze pressure anywhere in the structure. Options are equally calm: the put/call ratio of 0.20 is exactly in line with its 20-day average, with a z-score near zero. Neither the borrow market nor the options market is signalling any particular stress or conviction.
The fundamental picture gives the bulls something to work with, even if valuation is no longer cheap. The price-to-book multiple has expanded 7.6% over the past month and now sits just below 1.0x — a level at which regional banks historically attract more scrutiny on asset quality. The earnings yield factor ranks in the 95th percentile for forward EPS growth, and 90-day EPS momentum scores at the 76th percentile, both pointing to a bank where estimate revisions have been running in the right direction. Quality metrics remain the weak spot, consistent with prior notes flagging a low Piotroski F-score and thin returns on equity. The short score of 37.9 is unremarkable and has been drifting slightly lower all week, consistent with a stock that isn't attracting fresh short-side conviction.
Insider activity adds a mildly constructive footnote. Director Anson Moise bought 860 shares at $33.19 on June 15, and a second unnamed director made two small open-market purchases in early June at prices between $30.96 and $31.39. The amounts are modest — the largest single transaction came to roughly $28,500 — but the cluster of director buys at prices below current levels suggests at least some insiders were comfortable adding exposure during last month's run-up. Net insider activity over the past 90 days is positive at roughly 55,000 shares.
Peers from the regional bank universe broadly moved in the same direction this week. SYBT led the group with a 3% weekly gain, while FMBH and BCAL each added around 2.3–2.6%. CNOB's 1.1% weekly move lagged most of its closest correlates, a mild underperformance that may partly reflect the Raymond James downgrade absorbing some of the sector's momentum.
The next formal catalyst is the Q2 earnings release scheduled for July 30. With recent prints delivering 1- and 5-day gains of roughly 2% and 4% respectively, the stock has rewarded holders through earnings — the question heading into that date is whether the Street's estimate trajectory continues to justify the multiple expansion of the past month, especially with at least one bellwether now stepping to the sidelines.
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