ConnectOne Bancorp, Inc.'s (NASDAQ:CNOB) CEO Compensation Is Looking A Bit Stretched At The Moment

Simply Wall St
May 18, 2021
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CEO Frank Sorrentino has done a decent job of delivering relatively good performance at ConnectOne Bancorp, Inc. (NASDAQ:CNOB) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 25 May 2021. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for ConnectOne Bancorp

Comparing ConnectOne Bancorp, Inc.'s CEO Compensation With the industry

Our data indicates that ConnectOne Bancorp, Inc. has a market capitalization of US$1.1b, and total annual CEO compensation was reported as US$2.8m for the year to December 2020. We note that's an increase of 10% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$825k.

On comparing similar companies from the same industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$1.5m. This suggests that Frank Sorrentino is paid more than the median for the industry. Moreover, Frank Sorrentino also holds US$22m worth of ConnectOne Bancorp stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component20202019Proportion (2020)
Salary US$825k US$800k 29%
Other US$2.0m US$1.8m 71%
Total CompensationUS$2.8m US$2.6m100%

On an industry level, around 42% of total compensation represents salary and 58% is other remuneration. In ConnectOne Bancorp's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

NasdaqGS:CNOB CEO Compensation May 19th 2021

ConnectOne Bancorp, Inc.'s Growth

Over the past three years, ConnectOne Bancorp, Inc. has seen its earnings per share (EPS) grow by 31% per year. It achieved revenue growth of 29% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 ConnectOne Bancorp, Inc. Been A Good Investment?

ConnectOne Bancorp, Inc. has generated a total shareholder return of 6.3% over three years, so most shareholders wouldn't be too disappointed. Although, there's always room to improve. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

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, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

Whatever your view on compensation, you might want to check if insiders are buying or selling ConnectOne Bancorp shares (free trial).

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.

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