Patrick Callan has been the CEO of One Liberty Properties, Inc. (NYSE:OLP) since 2008, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the funds from operations and shareholder returns of the company.
Comparing One Liberty Properties, Inc.'s CEO Compensation With the industry
Our data indicates that One Liberty Properties, Inc. has a market capitalization of US$359m, and total annual CEO compensation was reported as US$1.8m for the year to December 2019. That's mostly flat as compared to the prior year's compensation. We think total compensation is more important but our data shows that the CEO salary is lower, at US$837k.
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$2.1m. From this we gather that Patrick Callan is paid around the median for CEOs in the industry. What's more, Patrick Callan holds US$4.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, roughly 15% of total compensation represents salary and 85% is other remuneration. It's interesting to note that One Liberty Properties pays out a greater portion of remuneration through salary, compared to the industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
One Liberty Properties, Inc.'s Growth
Over the last three years, One Liberty Properties, Inc. has not seen its funds from operations (FFO) change much, though they have deteriorated slightly. It achieved revenue growth of 3.4% over the last year.
A lack of FFO improvement is not good to see. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in FFO. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 One Liberty Properties, Inc. Been A Good Investment?
Given the total shareholder loss of 7.7% over three years, many shareholders in One Liberty Properties, Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As previously discussed, Patrick is compensated close to the median for companies of its size, and which belong to the same industry. In the meantime, the company has reported declining FFO growth and shareholder returns over the last three years. Considering overall performance, shareholders will likely hold off support for a raise until results improve.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 5 warning signs (and 2 which shouldn't be ignored) in One Liberty Properties we think you should know about.
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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