Gary Olson has been the CEO of ESSA Bancorp, Inc. (NASDAQ:ESSA) since 2006. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Gary Olson's Compensation Compare With Similar Sized Companies?
According to our data, ESSA Bancorp, Inc. has a market capitalization of US$164m, and pays its CEO total annual compensation worth US$724k. (This is based on the year to September 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$420k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO total compensation was US$1.2m.
Most shareholders would consider it a positive that Gary Olson takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business.
You can see, below, how CEO compensation at ESSA Bancorp has changed over time.
Is ESSA Bancorp, Inc. Growing?
ESSA Bancorp, Inc. has increased its earnings per share (EPS) by an average of 11% a year, over the last three years (using a line of best fit). It achieved revenue growth of 2.3% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. You might want to check this free visual report on analyst forecasts for future earnings.
Has ESSA Bancorp, Inc. Been A Good Investment?
With a total shareholder return of 17% over three years, ESSA Bancorp, Inc. shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
It looks like ESSA Bancorp, Inc. pays its CEO less than similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. While returns over the last few years haven't been top notch, there is nothing to suggest to us that Gary Olson is overcompensated.
It's great to see a company that pays its CEO reasonably, even while growing. But it would be nice if insiders were also buying shares. Whatever your view on compensation, you might want to check if insiders are buying or selling ESSA Bancorp shares (free trial).
Important note: ESSA Bancorp may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.