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Is Capitol Federal Financial, Inc. (NASDAQ:CFFN) Excessively Paying Its CEO?

Simply Wall St

John Dicus became the CEO of Capitol Federal Financial, Inc. (NASDAQ:CFFN) in 2003. First, this article will compare CEO compensation with compensation at similar sized companies. 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 method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Capitol Federal Financial

How Does John Dicus’s Compensation Compare With Similar Sized Companies?

Our data indicates that Capitol Federal Financial, Inc. is worth US$1.9b, and total annual CEO compensation is US$1.1m. (This figure is for the year to September 2018). That’s less than last year. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$648k. We examined companies with market caps from US$1.0b to US$3.2b, and discovered that the median CEO compensation of that group was US$3.4m.

Most shareholders would consider it a positive that John Dicus takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. While this is a good thing, you’ll need to understand the business better before you can form an opinion.

You can see, below, how CEO compensation at Capitol Federal Financial has changed over time.

NasdaqGS:CFFN CEO Compensation, February 28th 2019
NasdaqGS:CFFN CEO Compensation, February 28th 2019

Is Capitol Federal Financial, Inc. Growing?

Over the last three years Capitol Federal Financial, Inc. has grown its earnings per share (EPS) by an average of 7.2% per year (using a line of best fit). It achieved revenue growth of 1.9% over the last year.

I’m not particularly impressed by the revenue growth, but I’m happy with the modest EPS growth. So there are some positives here, but not enough to earn high praise. It could be important to check this free visual depiction of what analysts expect for the future.

Has Capitol Federal Financial, Inc. Been A Good Investment?

With a total shareholder return of 28% over three years, Capitol Federal Financial, Inc. shareholders would, in general, be reasonably content. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary…

It appears that Capitol Federal Financial, Inc. remunerates its CEO below most similar sized companies.

It’s well worth noting that while John Dicus is paid less than most company leaders (at companies of similar size), share price performance has been somewhat uninspiring. But on this analysis I see no issue with the CEO compensation. Whatever your view on compensation, you might want to check if insiders are buying or selling Capitol Federal Financial shares (free trial).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.