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Is Horizon Bancorp Inc (NASDAQ:HBNC) Excessively Paying Its CEO?

Craig Dwight became the CEO of Horizon Bancorp Inc (NASDAQ:HBNC) in 2001. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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.

View our latest analysis for Horizon Bancorp

How Does Craig Dwight’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Horizon Bancorp Inc has a market cap of US$653m, and is paying total annual CEO compensation of US$1.1m. Notably, that’s an increase of 22% over the year before. We examined companies with market caps from US$400m to US$1.6b, and discovered that the median CEO compensation of that group was US$2.2m.

A first glance this seems like a real positive for shareholders, since Craig Dwight is paid less than the average 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.

The graphic below shows how CEO compensation at Horizon Bancorp has changed from year to year.

NasdaqGS:HBNC CEO Compensation November 20th 18

Is Horizon Bancorp Inc Growing?

On average over the last three years, Horizon Bancorp Inc has grown earnings per share (EPS) by 13% each year. In the last year, its revenue is up 24%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business.

Shareholders might be interested in this free visualization of analyst forecasts. .

Has Horizon Bancorp Inc Been A Good Investment?

I think that the total shareholder return of 50%, over three years, would leave most Horizon Bancorp Inc shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

Horizon Bancorp Inc is currently paying its CEO below what is normal for companies of its size. Considering the underlying business is growing earnings, this would suggest the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Craig Dwight deserves a raise!

Most shareholders like to see a modestly paid CEO combined with strong performance by the company. But it is even better if company insiders are also buying shares with their own money.

Or you might prefer this data-rich interactive visualization of historic revenue and earnings.

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 editorial-team@simplywallst.com.