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Is Bankwell Financial Group, Inc.'s (NASDAQ:BWFG) CEO Paid Enough Relative To Peers?

Simply Wall St
·4 min read

In 2015, Chris Gruseke was appointed CEO of Bankwell Financial Group, Inc. (NASDAQ:BWFG). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Bankwell Financial Group

How Does Chris Gruseke's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Bankwell Financial Group, Inc. has a market cap of US$114m, and reported total annual CEO compensation of US$998k for the year to December 2019. That's less than last year. We think total compensation is more important but we note that the CEO salary is lower, at US$550k. We took a group of companies with market capitalizations below US$200m, and calculated the median CEO total compensation to be US$605k.

Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Bankwell Financial Group. On an industry level, roughly 43% of total compensation represents salary and 57% is other remuneration. Bankwell Financial Group does not set aside a larger portion of remuneration in the form of salary, maintaining the same rate as the wider market.

As you can see, Chris Gruseke is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Bankwell Financial Group, Inc. is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You can see a visual representation of the CEO compensation at Bankwell Financial Group, below.

NasdaqGM:BWFG CEO Compensation April 25th 2020
NasdaqGM:BWFG CEO Compensation April 25th 2020

Is Bankwell Financial Group, Inc. Growing?

On average over the last three years, Bankwell Financial Group, Inc. has seen earnings per share (EPS) move in a favourable direction by 12% each year (using a line of best fit). In the last year, its revenue is up 3.1%.

This demonstrates that the company has been improving recently. A good result. It's also good to see modest revenue growth, suggesting the underlying business is healthy. It could be important to check this free visual depiction of what analysts expect for the future.

Has Bankwell Financial Group, Inc. Been A Good Investment?

Since shareholders would have lost about 57% over three years, some Bankwell Financial Group, Inc. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared total CEO remuneration at Bankwell Financial Group, Inc. with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.

However, the earnings per share growth over three years is certainly impressive. On the other hand returns to investors over the same period have probably disappointed many. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. Shifting gears from CEO pay for a second, we've spotted 3 warning signs for Bankwell Financial Group you should be aware of, and 1 of them is a bit unpleasant.

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 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.

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. Thank you for reading.