Jack Clancy became the CEO of Enterprise Bancorp, Inc. (NASDAQ:EBTC) in 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. 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.
How Does Jack Clancy’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Enterprise Bancorp, Inc. has a market cap of US$369m, and is paying total annual CEO compensation of US$1.0m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$489k. We looked at a group of companies with market capitalizations from US$200m to US$800m, and the median CEO compensation was US$1.6m.
Most shareholders would consider it a positive that Jack Clancy takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it’s important we delve into the performance of the actual business.
You can see, below, how CEO compensation at Enterprise Bancorp has changed over time.
Is Enterprise Bancorp, Inc. Growing?
Over the last three years Enterprise Bancorp, Inc. has grown its earnings per share (EPS) by an average of 8.3% per year (using a line of best fit). In the last year, its revenue is up 12%.
I would argue that the modest growth in revenue is a notable positive. And, while modest, the earnings per share growth is noticeable. So while performance isn’t amazing, we think it really does seem quite respectable.
We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Enterprise Bancorp, Inc. Been A Good Investment?
I think that the total shareholder return of 60%, over three years, would leave most Enterprise Bancorp, 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.
It looks like Enterprise Bancorp, Inc. pays its CEO less than similar sized companies.
Jack Clancy receives relatively low remuneration compared to similar sized companies. And the returns to shareholders were great, over the last few years. So, while it might be nice to have better EPS growth, on our analysis the CEO compensation is quite modest. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Enterprise Bancorp.
Or you might rather take a peek at this analytical visualization of historic cash flow, earnings 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 firstname.lastname@example.org.