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Jeff Haley became the CEO of American National Bankshares Inc. (NASDAQ:AMNB) in 2013, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For Jeff Haley Compare With Other Companies In The Industry?
According to our data, American National Bankshares Inc. has a market capitalization of US$253m, and paid its CEO total annual compensation worth US$942k over the year to December 2019. Notably, that's an increase of 14% over the year before. In particular, the salary of US$534.2k, makes up a huge portion of the total compensation being paid to the CEO.
On comparing similar companies from the same industry with market caps ranging from US$100m to US$400m, we found that the median CEO total compensation was US$913k. So it looks like American National Bankshares compensates Jeff Haley in line with the median for the industry. Furthermore, Jeff Haley directly owns US$1.2m worth of shares in the company.
On an industry level, roughly 43% of total compensation represents salary and 57% is other remuneration. It's interesting to note that American National Bankshares pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
American National Bankshares Inc.'s Growth
American National Bankshares Inc. has seen its earnings per share (EPS) increase by 3.9% a year over the past three years. In the last year, its revenue is up 32%.
It's hard to interpret the strong revenue growth as anything other than a positive. And in that context, the modest EPS improvement certainly isn't shabby. So while we'd stop short of saying growth is absolutely outstanding, there are definitely some clear positives! Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has American National Bankshares Inc. Been A Good Investment?
Since shareholders would have lost about 31% over three years, some American National Bankshares Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As we touched on above, American National Bankshares Inc. is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Meanwhile, American National Bankshares is suffering from adverse shareholder returns and although earnings have grown over the past three years, they have not been extraordinary. Although we wouldn't say CEO compensation is exceptionally high, it isn't very low either. Shareholders might want to see substantial improvements in returns before agreeing that Jeff deserves a raise.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for American National Bankshares (of which 1 doesn't sit too well with us!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from American National Bankshares, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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