Here's Why ESSA Bancorp, Inc.'s (NASDAQ:ESSA) CEO Compensation Is The Least Of Shareholders' Concerns

By
Simply Wall St
Published
February 25, 2022
NasdaqGS:ESSA
Source: Shutterstock

Under the guidance of CEO Gary Olson, ESSA Bancorp, Inc. (NASDAQ:ESSA) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 03 March 2022. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

Check out our latest analysis for ESSA Bancorp

How Does Total Compensation For Gary Olson Compare With Other Companies In The Industry?

Our data indicates that ESSA Bancorp, Inc. has a market capitalization of US$172m, and total annual CEO compensation was reported as US$1.1m for the year to September 2021. We note that's an increase of 11% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$494k.

In comparison with other companies in the industry with market capitalizations ranging from US$100m to US$400m, the reported median CEO total compensation was US$874k. So it looks like ESSA Bancorp compensates Gary Olson in line with the median for the industry. What's more, Gary Olson holds US$2.2m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20212020Proportion (2021)
Salary US$494k US$463k 47%
Other US$563k US$488k 53%
Total CompensationUS$1.1m US$951k100%

On an industry level, around 52% of total compensation represents salary and 48% is other remuneration. ESSA Bancorp is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
NasdaqGS:ESSA CEO Compensation February 25th 2022

A Look at ESSA Bancorp, Inc.'s Growth Numbers

ESSA Bancorp, Inc.'s earnings per share (EPS) grew 19% per year over the last three years. In the last year, its revenue is up 5.2%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see modest revenue growth, suggesting the underlying business is healthy. 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 ESSA Bancorp, Inc. Been A Good Investment?

ESSA Bancorp, Inc. has generated a total shareholder return of 21% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.

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

Switching gears from ESSA Bancorp, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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