Yahoo Finance Shareholders May Be A Bit More Conservative With PCB Bancorp's (NASDAQ:PCB) CEO Compensation For Now
As many shareholders of PCB Bancorp (NASDAQ:PCB) will be aware, they have not made a gain on their investment in the past three years. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 27 May 2021. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.
See our latest analysis for PCB Bancorp
Comparing PCB Bancorp's CEO Compensation With the industry
Our data indicates that PCB Bancorp has a market capitalization of US$252m, and total annual CEO compensation was reported as US$550k for the year to December 2020. Notably, that's a decrease of 37% over the year before. Notably, the salary which is US$350.0k, represents most of the total compensation being paid.
On comparing similar companies from the same industry with market caps ranging from US$100m to US$400m, we found that the median CEO total compensation was US$763k. This suggests that PCB Bancorp remunerates its CEO largely in line with the industry average. Furthermore, Henry Kim directly owns US$2.8m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2020 | 2019 | Proportion (2020) |
Salary | US$350k | US$350k | 64% |
Other | US$200k | US$527k | 36% |
Total Compensation | US$550k | US$877k | 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. It's interesting to note that PCB Bancorp pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at PCB Bancorp's Growth Numbers
Earnings per share at PCB Bancorp are much the same as they were three years ago, albeit with slightly higher. Its revenue is down 2.6% over the previous year.
We generally like to see a little revenue growth, but the modest improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has PCB Bancorp Been A Good Investment?
Since shareholders would have lost about 2.6% over three years, some PCB Bancorp investors would surely be feeling negative emotions. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 2 warning signs for PCB Bancorp (1 is potentially serious!) that you should be aware of before investing here.
Switching gears from PCB Bancorp, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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.
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