Frank Sorrentino has been the CEO of ConnectOne Bancorp, Inc. (NASDAQ:CNOB) since 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Frank Sorrentino’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that ConnectOne Bancorp, Inc. has a market cap of US$698m, and is paying total annual CEO compensation of US$1.9m. (This number is for the twelve months until December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$735k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$400m to US$1.6b. The median total CEO compensation was US$2.2m.
So Frank Sorrentino receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.
You can see, below, how CEO compensation at ConnectOne Bancorp has changed over time.
Is ConnectOne Bancorp, Inc. Growing?
On average over the last three years, ConnectOne Bancorp, Inc. has grown earnings per share (EPS) by 6.9% each year (using a line of best fit). It saw its revenue drop -3.7% over the last year.
I would prefer it if there was revenue growth, but I’m happy with the EPS growth. These two metric are moving in different directions, so while it’s hard to be confident judging performance, we think the stock is worth watching. Shareholders might be interested in this free visualization of analyst forecasts.
Has ConnectOne Bancorp, Inc. Been A Good Investment?
Most shareholders would probably be pleased with ConnectOne Bancorp, Inc. for providing a total return of 43% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Frank Sorrentino is paid around the same as most CEOs of similar size companies.
While we would like to see improved growth metrics, there is no doubt that the total returns have been great, over the last three years. So all things considered I’d venture that the CEO pay is appropriate. So you may want to check if insiders are buying ConnectOne Bancorp shares with their own money (free access).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.