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Is Financial Institutions, Inc.'s (NASDAQ:FISI) CEO Pay Justified?

Simply Wall St

Marty Birmingham became the CEO of Financial Institutions, Inc. (NASDAQ:FISI) in 2013. 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 we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

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See our latest analysis for Financial Institutions

How Does Marty Birmingham's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Financial Institutions, Inc. has a market cap of US$444m, and is paying total annual CEO compensation of US$1.1m. (This is based on the year to December 2018). That's below the compensation, last year. We think total compensation is more important but we note that the CEO salary is lower, at US$560k. We examined companies with market caps from US$200m to US$800m, and discovered that the median CEO total compensation of that group was US$1.8m.

A first glance this seems like a real positive for shareholders, since Marty Birmingham is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.

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

NasdaqGS:FISI CEO Compensation, May 21st 2019

Is Financial Institutions, Inc. Growing?

Financial Institutions, Inc. has increased its earnings per share (EPS) by an average of 9.4% a year, over the last three years (using a line of best fit). It achieved revenue growth of 13% over the last year.

This revenue growth could really point to a brighter future. And the modest growth in earnings per share isn't bad, either. Although we'll stop short of calling the stock a top performer, we think the company has potential. It could be important to check this free visual depiction of what analysts expect for the future.

Has Financial Institutions, Inc. Been A Good Investment?

Financial Institutions, Inc. has served shareholders reasonably well, with a total return of 10% over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

Financial Institutions, Inc. is currently paying its CEO below what is normal for companies of its size.

It's well worth noting that while Marty Birmingham is paid less than most company leaders (at companies of similar size), share price performance has been somewhat uninspiring. However I do not find the CEO compensation to be concerning. Shareholders may want to check for free if Financial Institutions insiders are buying or selling shares.

If you want to buy a stock that is better than Financial Institutions, this free list of high return, low debt companies is a great place to look.

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.