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In 2013 Scott Beatty was appointed CEO of Shore Bancshares, Inc. (NASDAQ:SHBI). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Scott Beatty's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Shore Bancshares, Inc. has a market cap of US$207m, and is paying total annual CEO compensation of US$615k. (This number is for the twelve months until December 2018). That's actually a decrease on the year before. While we always look at total compensation first, we note that the salary component is less, at US$450k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$100m to US$400m. The median total CEO compensation was US$1.1m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. Though positive, it's important we delve into the performance of the actual business.
You can see a visual representation of the CEO compensation at Shore Bancshares, below.
Is Shore Bancshares, Inc. Growing?
Shore Bancshares, Inc. has increased its earnings per share (EPS) by an average of 20% a year, over the last three years (using a line of best fit). It achieved revenue growth of 14% over the last year.
This demonstrates that the company has been improving recently. A good result. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Shore Bancshares, Inc. Been A Good Investment?
Boasting a total shareholder return of 45% over three years, Shore Bancshares, Inc. has done well by shareholders. 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 appears that Shore Bancshares, Inc. remunerates its CEO below most similar sized companies. Since the business is growing, many would argue this suggests the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Scott Beatty deserves a raise!
It's not often we see shareholders do so well, and yet the CEO is paid modestly. But it is even better if company insiders are also buying shares with their own money. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Shore Bancshares (free visualization of insider trades).
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.
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 firstname.lastname@example.org. 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.