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Is Prudential Bancorp, Inc.'s (NASDAQ:PBIP) CEO Being Overpaid?

Simply Wall St

Dennis Pollack has been the CEO of Prudential Bancorp, Inc. (NASDAQ:PBIP) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. 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.

See our latest analysis for Prudential Bancorp

How Does Dennis Pollack's Compensation Compare With Similar Sized Companies?

According to our data, Prudential Bancorp, Inc. has a market capitalization of US$159m, and paid its CEO total annual compensation worth US$711k over the year to September 2019. That's actually a decrease on the year before. We think total compensation is more important but we note that the CEO salary is lower, at US$404k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO total compensation was US$1.1m.

This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.

You can see a visual representation of the CEO compensation at Prudential Bancorp, below.

NasdaqGM:PBIP CEO Compensation, January 24th 2020

Is Prudential Bancorp, Inc. Growing?

On average over the last three years, Prudential Bancorp, Inc. has grown earnings per share (EPS) by 54% each year (using a line of best fit). It achieved revenue growth of 7.3% over the last year.

This demonstrates that the company has been improving recently. A good result. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Prudential Bancorp, Inc. Been A Good Investment?

Prudential Bancorp, Inc. has generated a total shareholder return of 11% over three years, so most shareholders would be reasonably content. 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...

It looks like Prudential Bancorp, Inc. pays its CEO less than similar sized companies.

Since the business is growing, many would argue this suggests the pay is modest. While some might be keen on seeing higher returns, our short analysis has not produced any evidence to suggest Dennis Pollack is overcompensated. It's good to see reasonable payment of the CEO, even while the business improves. But it would be nice if insiders were also buying shares. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Prudential Bancorp (free visualization of insider trades).

Important note: Prudential 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.

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.

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. Thank you for reading.