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Most Shareholders Will Probably Agree With Citizens & Northern Corporation's (NASDAQ:CZNC) CEO Compensation

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Performance at Citizens & Northern Corporation (NASDAQ:CZNC) has been reasonably good and CEO Brad Scovill has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 22 April 2021. Here is our take on why we think the CEO compensation looks appropriate.

See our latest analysis for Citizens & Northern

How Does Total Compensation For Brad Scovill Compare With Other Companies In The Industry?

Our data indicates that Citizens & Northern Corporation has a market capitalization of US$357m, and total annual CEO compensation was reported as US$1.0m for the year to December 2020. That's a notable increase of 13% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$475k.

In comparison with other companies in the industry with market capitalizations ranging from US$200m to US$800m, the reported median CEO total compensation was US$1.1m. So it looks like Citizens & Northern compensates Brad Scovill in line with the median for the industry. Furthermore, Brad Scovill directly owns US$1.9m worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2020

2019

Proportion (2020)

Salary

US$475k

US$437k

45%

Other

US$571k

US$489k

55%

Total Compensation

US$1.0m

US$926k

100%

Talking in terms of the industry, salary represented approximately 42% of total compensation out of all the companies we analyzed, while other remuneration made up 58% of the pie. Although there is a difference in how total compensation is set, Citizens & Northern more or less reflects the market in terms of setting the salary. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

ceo-compensation
ceo-compensation

A Look at Citizens & Northern Corporation's Growth Numbers

Citizens & Northern Corporation has seen its earnings per share (EPS) increase by 5.5% a year over the past three years. In the last year, its revenue is up 20%.

We would argue that the modest growth in revenue is a notable positive. And the improvement in EPSis modest but respectable. Although we'll stop short of calling the stock a top performer, we think the company has potential. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Citizens & Northern Corporation Been A Good Investment?

Citizens & Northern Corporation has served shareholders reasonably well, with a total return of 14% 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.

In Summary...

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. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Citizens & Northern that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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.

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