There Could Be A Chance Glen Burnie Bancorp's (NASDAQ:GLBZ) CEO Will Have Their Compensation Increased

Shareholders will be pleased by the robust performance of Glen Burnie Bancorp (NASDAQ:GLBZ) recently and this will be kept in mind in the upcoming AGM on 13 May 2021. They will probably be more interested in hearing the board discuss future initiatives to further improve the business as they vote on resolutions such as executive remuneration. In our analysis below, we discuss why we think the CEO compensation looks acceptable and the case for a raise.

Check out our latest analysis for Glen Burnie Bancorp

Comparing Glen Burnie Bancorp's CEO Compensation With the industry

At the time of writing, our data shows that Glen Burnie Bancorp has a market capitalization of US$34m, and reported total annual CEO compensation of US$386k for the year to December 2020. We note that's an increase of 11% above last year. We note that the salary portion, which stands at US$318.7k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$577k. Accordingly, Glen Burnie Bancorp pays its CEO under the industry median. What's more, John Long holds US$95k worth of shares in the company in their own name.

Component	2020	2019	Proportion (2020)
Salary	US$319k	US$300k	82%
Other	US$68k	US$48k	18%
Total Compensation	US$386k	US$348k	100%

Speaking on an industry level, nearly 42% of total compensation represents salary, while the remainder of 58% is other remuneration. Glen Burnie Bancorp is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Glen Burnie Bancorp's Growth

Over the past three years, Glen Burnie Bancorp has seen its earnings per share (EPS) grow by 33% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Glen Burnie Bancorp Been A Good Investment?

Glen Burnie Bancorp has served shareholders reasonably well, with a total return of 14% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

The company's overall performance, while not bad, could be better. If it continues on the same road, shareholders might feel even more confident about their investment, and have little to no objections concerning CEO pay. Rather, investors would more likely want to engage on discussions related to key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Glen Burnie Bancorp that investors should think about before committing capital to this stock.

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.

If you decide to trade Glen Burnie Bancorp, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.