We Think Shareholders Are Less Likely To Approve A Large Pay Rise For Magyar Bancorp, Inc.'s (NASDAQ:MGYR) CEO For Now

Key Insights

• Magyar Bancorp to hold its Annual General Meeting on 22nd of February
• Total pay for CEO John Fitzgerald includes US$522.8k salary
• Total compensation is 84% above industry average
• Magyar Bancorp's total shareholder return over the past three years was 38% while its EPS grew by 39% over the past three years

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 22nd of February. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See 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$78m, and paid its CEO total annual compensation worth US$1.2m over the year to September 2023. That's a notable decrease of 35% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$523k.

In comparison with other companies in the American Banks industry with market capitalizations under US$200m, the reported median total CEO compensation was US$635k. Accordingly, our analysis reveals that Magyar Bancorp, Inc. pays John Fitzgerald north of the industry median. What's more, John Fitzgerald holds US$1.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$523k	US$498k	45%
Other	US$645k	US$1.3m	55%
Total Compensation	US$1.2m	US$1.8m	100%

Talking in terms of the industry, salary represented approximately 43% of total compensation out of all the companies we analyzed, while other remuneration made up 57% of the pie. Although there is a difference in how total compensation is set, Magyar Bancorp more or less reflects the market in terms of setting the salary. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's 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 39% per year. Its revenue is up 2.1% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Magyar Bancorp, Inc. Been A Good Investment?

We think that the total shareholder return of 38%, over three years, would leave most Magyar Bancorp, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

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. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for Magyar Bancorp that you should be aware of before investing.

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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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.