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Is Banner Corporation’s (NASDAQ:BANR) CEO Being Overpaid?

Matthew Smith

Mark Grescovich became the CEO of Banner Corporation (NASDAQ:BANR) in 2010. 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 – 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.

See our latest analysis for Banner

How Does Mark Grescovich’s Compensation Compare With Similar Sized Companies?

Our data indicates that Banner Corporation is worth US$2.0b, and total annual CEO compensation is US$2.3m. (This is based on the year to 2017). While we always look at total compensation first, we note that the salary component is less, at US$767k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$3.5m.

This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.

You can see a visual representation of the CEO compensation at Banner, below.

NASDAQGS:BANR CEO Compensation January 25th 19

Is Banner Corporation Growing?

Over the last three years Banner Corporation has grown its earnings per share (EPS) by an average of 16% per year (using a line of best fit). It achieved revenue growth of 9.2% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions.

It could be important to check this free visual depiction of what analysts expect for the future.

Has Banner Corporation Been A Good Investment?

Boasting a total shareholder return of 47% over three years, Banner Corporation has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary…

It looks like Banner Corporation 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 Mark Grescovich deserves a raise!

It is relatively rare to see a modestly paid CEO when performance is so impressive. But it is even better if company insiders are also buying shares with their own money. So you may want to check if insiders are buying Banner shares with their own money (free access).

Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.