GET DAILY SIGNALSConnectOne Bancorp (CNOB): Q3 2026 Results Show Operating Strength Despite Restructuring Charge
Key Takeaways
- ConnectOne reported third-quarter 2026 net income of $31.4 million, or $0.59 in diluted earnings per share (EPS), including a one-time restructuring charge.
- The results included a $23.0 million pretax loss tied to a balance-sheet repositioning and the planned sale of up to roughly $750 million in multifamily loans.
- Excluding one-time items, operating EPS reached $0.95, up 13% sequentially and 35% year over year, beating the consensus estimate of $0.85.
- Net interest income rose 15% year over year to $117.3 million, while net interest margin expanded to 3.44% from 3.11% a year earlier.
- The board declared a quarterly common-stock dividend of $0.195 per share, payable December 1, 2026.
Why This Quarter Matters
ConnectOne Bancorp, the Englewood Cliffs, New Jersey-based parent of ConnectOne Bank, has spent 2026 integrating its acquisition of First of Long Island Corporation. That merger meaningfully expanded its balance sheet while adding a large pool of non-relationship multifamily loans, a segment management has been eager to trim. This quarter’s report matters because it pairs a continued step-up in core operating performance with a decisive restructuring designed to reduce commercial real estate (CRE) concentration and free up capital. For investors, the report offers a clear read on whether ConnectOne Bancorp can keep expanding its net interest margin and earnings while simultaneously de-risking a balance sheet that has drawn scrutiny in the regional-banking sector. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Breaking Down the Reported Results
ConnectOne Bancorp posted third-quarter 2026 net income of $31.4 million, with diluted EPS of $0.59. Net income available to common stockholders was $29.9 million, compared with $40.2 million in the prior quarter and $39.5 million a year earlier. The decline was driven almost entirely by a $23.0 million pretax loss on loans held for sale recorded as part of the balance-sheet restructuring, rather than any deterioration in the underlying business.
On an operating basis, excluding the restructuring charge and other non-operating items, EPS was $0.95 per share, up 13% sequentially from $0.84 and 35% higher than a year ago. That operating result exceeded the Wall Street consensus estimate of $0.85. Reported revenue of $125.83 million rose 3.6% year over year and came in modestly above the $125 million consensus figure.
Net interest income (the difference between interest earned on loans and interest paid on deposits) climbed 15% to $117.3 million, helped by a widening net interest margin (NIM) of 3.44%, up 33 basis points from 3.11% a year ago. Credit quality also improved, with nonperforming assets falling to $64.3 million from $79.7 million in the second quarter and the provision for credit losses easing to $5.0 million from $8.3 million. Total assets stood at $14.8 billion, with deposits of $11.8 billion.
How the Market Reacted
The headline EPS figure of $0.59 fell well short of the roughly $0.85 consensus, but the shortfall was attributable to a clearly disclosed, non-operating restructuring charge rather than core weakness. Investors focused instead on the operating EPS of $0.95, which exceeded estimates by roughly 12%. Sentiment entering the report had centered on the fate of the multifamily loan portfolio, and management’s announcement of a definitive agreement to sell up to approximately $750 million of those loans addressed that overhang directly. The planned sale cuts the company’s exposure to New York City rent-stabilized loans by up to two-thirds, an outcome likely to be read favorably by investors concerned about CRE concentration risk, even as the accounting treatment pressured the reported quarter’s bottom line.
Looking Ahead
ConnectOne Bancorp enters the fourth quarter with a more liquid, lower-risk balance sheet and a management team emphasizing core relationship banking. Management guided toward mid-single-digit loan and deposit growth and projected a 2% to 2.5% sequential increase in operating expenses for the fourth quarter, with a projected effective tax rate of 27.5%.
The loan sale is expected to close within about a week of the report, and management intends to reinvest the bulk of the proceeds into lower-risk assets with slightly higher yields while using a smaller portion to pay down wholesale funding. That shift is expected to support net interest margin and return on assets over time, though it may modestly temper near-term reinvestment earnings. Investors should also note that roughly $7 million to $8 million of additional non-operating transaction costs tied to the sale will be recognized in the fourth quarter rather than the third.
Key factors to watch include whether deposit growth sustains its recent double-digit annualized pace, how the remaining rent-stabilized loan book performs, and whether the efficiency ratio continues its improvement after falling to 41%. Capital deployment remains in focus as well, with management citing flexibility for dividends, buybacks, and preferred-stock redemption following the repositioning.
Using Tickeron Tools in My Research
One tool I’ve found useful for this kind of analysis is Tickeron’s AI Screener. It helps me quickly filter stocks and ETFs by technical patterns, fundamentals, and performance metrics, making it easier to spot ideas and compare names during earnings season. I often use it to build watchlists that align with my own research process.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
CNOB in +0.92% Uptrend, advancing for three consecutive days on October 27, 2026
Moving higher for three straight days is viewed as a bullish sign. Keep an eye on this stock for future growth. Considering data from situations where CNOB advanced for three days, in 183 of 286 cases, the price rose further within the following month. The odds of a continued upward trend are 64%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on November 11, 2026. You may want to consider a long position or call options on CNOB as a result. In 59 of 94 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 63%.
The Moving Average Convergence Divergence (MACD) for CNOB just turned positive on October 15, 2026. Looking at past instances where CNOB's MACD turned positive, the stock continued to rise in 27 of 43 cases over the following month. The odds of a continued upward trend are 63%.
CNOB moved above its 50-day moving average on October 22, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for CNOB crossed bullishly above the 50-day moving average on October 27, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 9 of 16 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 56%.
The Aroon Indicator entered an Uptrend today. In 129 of 226 cases where CNOB Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 57%.
Bearish Trend Analysis
The 10-day RSI Indicator for CNOB moved out of overbought territory on October 28, 2026. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 33 similar instances where the indicator moved out of overbought territory. In 26 of the 33 cases, the stock moved lower in the following days. This puts the odds of a move lower at 79%.
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In 34 of 51 cases where CNOB's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are 67%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where CNOB declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 71%.
CNOB broke above its upper Bollinger Band on October 22, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 18 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Price Growth Rating for this company is 43 (best 1 - 100 worst), indicating steady price growth. CNOB’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Valuation Rating of 44 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.076) is normal, around the industry mean (1.262). P/E Ratio (10.006) is within average values for comparable stocks, (13.479). Projected Growth (PEG Ratio) (0.130) is also within normal values, averaging (1.190). Dividend Yield (0.024) settles around the average of (0.035) among similar stocks. P/S Ratio (3.457) is also within normal values, averaging (3.738).
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Profit vs. Risk Rating rating for this company is 81 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. CNOB’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 56, placing this stock worse than average.
The Tickeron PE Growth Rating for this company is 89 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
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