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Increases to Meridian Corporation's (NASDAQ:MRBK) CEO Compensation Might Cool off for now

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Under the guidance of CEO Chris Annas, Meridian Corporation (NASDAQ:MRBK) has performed reasonably well recently. As shareholders go into the upcoming AGM on 17 June 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Meridian

How Does Total Compensation For Chris Annas Compare With Other Companies In The Industry?

At the time of writing, our data shows that Meridian Corporation has a market capitalization of US$163m, and reported total annual CEO compensation of US$1.1m for the year to December 2020. We note that's an increase of 14% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$465k.

On examining similar-sized companies in the industry with market capitalizations between US$100m and US$400m, we discovered that the median CEO total compensation of that group was US$763k. Hence, we can conclude that Chris Annas is remunerated higher than the industry median. Moreover, Chris Annas also holds US$6.6m worth of Meridian stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component

2020

2019

Proportion (2020)

Salary

US$465k

US$450k

43%

Other

US$604k

US$488k

57%

Total Compensation

US$1.1m

US$938k

100%

On an industry level, roughly 43% of total compensation represents salary and 57% is other remuneration. Although there is a difference in how total compensation is set, Meridian more or less reflects the market in terms of setting the salary. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
ceo-compensation

A Look at Meridian Corporation's Growth Numbers

Over the past three years, Meridian Corporation has seen its earnings per share (EPS) grow by 96% per year. Its revenue is up 114% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Meridian Corporation Been A Good Investment?

Most shareholders would probably be pleased with Meridian Corporation for providing a total return of 62% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for Meridian you should be aware of, and 2 of them are concerning.

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.

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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.