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

Under the guidance of CEO John Fitzgerald, Magyar Bancorp, Inc. (NASDAQ:MGYR) 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 16 February 2022. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Magyar Bancorp

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

According to our data, Magyar Bancorp, Inc. has a market capitalization of US$87m, and paid its CEO total annual compensation worth US$914k over the year to September 2021. That's just a smallish increase of 4.4% on last year. In particular, the salary of US$474.5k, makes up a fairly large portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$510k. This suggests that John Fitzgerald is paid more than the median for the industry. What's more, John Fitzgerald holds US$1.3m worth of shares in the company in their own name.

Component	2021	2020	Proportion (2021)
Salary	US$474k	US$452k	52%
Other	US$440k	US$423k	48%
Total Compensation	US$914k	US$875k	100%

On an industry level, around 52% of total compensation represents salary and 48% is other remuneration. Our data reveals that Magyar Bancorp allocates salary more or less in line with the wider market. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

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

Over the past three years, Magyar Bancorp, Inc. has seen its earnings per share (EPS) grow by 40% per year. Its revenue is up 24% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Magyar Bancorp, Inc. Been A Good Investment?

Magyar Bancorp, Inc. has generated a total shareholder return of 31% 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...

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.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Magyar Bancorp that investors should think about before committing capital to this stock.

Important note: Magyar 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.