Is Peoples Bancorp of North Carolina, Inc.'s (NASDAQ:PEBK) CEO Salary Justified?

By
Simply Wall St
Published
November 12, 2019
NasdaqGM:PEBK

In 2012 Lance Sellers was appointed CEO of Peoples Bancorp of North Carolina, Inc. (NASDAQ:PEBK). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Peoples Bancorp of North Carolina

How Does Lance Sellers's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Peoples Bancorp of North Carolina, Inc. has a market cap of US$175m, and reported total annual CEO compensation of US$517k for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$329k. We examined companies with market caps from US$100m to US$400m, and discovered that the median CEO total compensation of that group was US$1.2m.

This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.

You can see a visual representation of the CEO compensation at Peoples Bancorp of North Carolina, below.

NasdaqGM:PEBK CEO Compensation, November 12th 2019
NasdaqGM:PEBK CEO Compensation, November 12th 2019

Is Peoples Bancorp of North Carolina, Inc. Growing?

Peoples Bancorp of North Carolina, Inc. has increased its earnings per share (EPS) by an average of 18% a year, over the last three years (using a line of best fit). Its revenue is up 8.8% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see a little revenue growth, as this is consistent with healthy business conditions.

Has Peoples Bancorp of North Carolina, Inc. Been A Good Investment?

I think that the total shareholder return of 61%, over three years, would leave most Peoples Bancorp of North Carolina, 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...

It looks like Peoples Bancorp of North Carolina, Inc. pays its CEO less than similar sized companies.

Since the business is growing, many would argue this suggests the pay is modest. The pleasing shareholder returns are the cherry on top; you might even consider that Lance Sellers deserves a raise! It's not often we see shareholders do so well, and yet the CEO is paid modestly. But it is even better if company insiders are also buying shares with their own money. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Peoples Bancorp of North Carolina (free visualization of insider trades).

If you want to buy a stock that is better than Peoples Bancorp of North Carolina, this free list of high return, low debt companies is a great place to look.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.

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