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Is Patriot National Bancorp, Inc.'s (NASDAQ:PNBK) CEO Being Overpaid?

Simply Wall St

Michael Carrazza became the CEO of Patriot National Bancorp, Inc. (NASDAQ:PNBK) in 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. 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.

Check out our latest analysis for Patriot National Bancorp

How Does Michael Carrazza's Compensation Compare With Similar Sized Companies?

According to our data, Patriot National Bancorp, Inc. has a market capitalization of US$50m, and pays its CEO total annual compensation worth US$804k. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$300k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$497k.

Thus we can conclude that Michael Carrazza receives more in total compensation than the median of a group of companies in the same market, and of similar size to Patriot National Bancorp, Inc.. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Patriot National Bancorp has changed over time.

NasdaqGM:PNBK CEO Compensation, September 17th 2019

Is Patriot National Bancorp, Inc. Growing?

Earnings per share at Patriot National Bancorp, Inc. are much the same as they were three years ago, albeit with a positive trend. Its revenue is down -12% over last year.

I would argue that the lack of revenue growth in the last year is less than ideal, but it is good to see modest 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. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Patriot National Bancorp, Inc. Been A Good Investment?

With a three year total loss of 7.8%, Patriot National Bancorp, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.

In Summary...

We compared total CEO remuneration at Patriot National Bancorp, Inc. with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.

The growth in the business has been uninspiring, but the shareholder returns have arguably been worse, over the last three years. Shareholders may wish to consider further research. Although we don't think the CEO pay is too high, it is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Patriot National Bancorp (free visualization of insider trades).

If you want to buy a stock that is better than Patriot National Bancorp, this free list of high return, low debt companies is a great place to look.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.