In 2012 David Silverman was appointed CEO of Union Bankshares, Inc. (NASDAQ:UNB). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This method should give us information to assess how appropriately the company pays the CEO.
How Does David Silverman's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Union Bankshares, Inc. has a market cap of US$164m, and reported total annual CEO compensation of US$542k for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$350k. When we examined a selection of companies with market caps ranging from US$100m to US$400m, we found the median CEO total 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. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Union Bankshares has changed over time.
Is Union Bankshares, Inc. Growing?
Union Bankshares, Inc. has reduced its earnings per share by an average of 5.7% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 6.2%.
Sadly for shareholders, earnings per share are actually down, over three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Union Bankshares, Inc. Been A Good Investment?
Given the total loss of 3.4% over three years, many shareholders in Union Bankshares, Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
Union Bankshares, Inc. is currently paying its CEO below what is normal for companies of its size.
Shareholders should note that compensation for David Silverman is under the median of a group of similar sized companies. But then, EPS growth is lacking and so are the returns to shareholders. Considering all these factors, we'd stop short of saying the CEO pay is too high, but we don't think shareholders would want to see a pay rise before business performance improves. Shareholders may want to check for free if Union Bankshares insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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