John Long has been the CEO of Glen Burnie Bancorp (NASDAQ:GLBZ) since 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does John Long’s Compensation Compare With Similar Sized Companies?
According to our data, Glen Burnie Bancorp has a market capitalization of US$33m, and pays its CEO total annual compensation worth US$277k. (This is based on the year to December 2017). While we always look at total compensation first, we note that the salary component is less, at US$242k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO compensation in that group is US$297k.
So John Long receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
The graphic below shows how CEO compensation at Glen Burnie Bancorp has changed from year to year.
Is Glen Burnie Bancorp Growing?
Over the last three years Glen Burnie Bancorp has shrunk its earnings per share by an average of 9.6% per year (measured with a line of best fit). Its revenue is up 5.9% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. The modest increase in revenue in the last year isn’t enough to make me overlook the disappointing change in earnings per share. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don’t have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Glen Burnie Bancorp Been A Good Investment?
Glen Burnie Bancorp has served shareholders reasonably well, with a total return of 19% over three years. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.
John Long is paid around what is normal the leaders of comparable size companies.
We feel that earnings per share have been a bit disappointing, but and we don’t think the total returns are amazing. We’re not saying the CEO pay is too generous, but one might argue that the company should improve returns to shareholders before increasing it. So you may want to check if insiders are buying Glen Burnie Bancorp shares with their own money (free access).
If you want to buy a stock that is better than Glen Burnie Bancorp, this free list of high return, low debt companies is a great place to look.
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