Shareholders Would Not Be Objecting To Greene County Bancorp, Inc.'s (NASDAQ:GCBC) CEO Compensation And Here's Why

The performance at Greene County Bancorp, Inc. (NASDAQ:GCBC) has been quite strong recently and CEO Don Gibson has played a role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 05 November 2022. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

Our analysis indicates that GCBC is potentially overvalued!

How Does Total Compensation For Don Gibson Compare With Other Companies In The Industry?

At the time of writing, our data shows that Greene County Bancorp, Inc. has a market capitalization of US$579m, and reported total annual CEO compensation of US$1.8m for the year to June 2022. Notably, that's an increase of 9.8% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$558k.

On examining similar-sized companies in the industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$1.5m. From this we gather that Don Gibson is paid around the median for CEOs in the industry. What's more, Don Gibson holds US$5.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2022	2021	Proportion (2022)
Salary	US$558k	US$531k	31%
Other	US$1.2m	US$1.1m	69%
Total Compensation	US$1.8m	US$1.6m	100%

Speaking on an industry level, nearly 49% of total compensation represents salary, while the remainder of 51% is other remuneration. Greene County Bancorp pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Greene County Bancorp, Inc.'s Growth

Greene County Bancorp, Inc. has seen its earnings per share (EPS) increase by 19% a year over the past three years. Its revenue is up 12% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Greene County Bancorp, Inc. Been A Good Investment?

We think that the total shareholder return of 156%, over three years, would leave most Greene County Bancorp, Inc. shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Greene County Bancorp (free visualization of insider trades).

Important note: Greene County Bancorp is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.