Richard Adams became the CEO of United Bankshares, Inc. (NASDAQ:UBSI) in 1984. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. 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 Richard Adams's Compensation Compare With Similar Sized Companies?
Our data indicates that United Bankshares, Inc. is worth US$3.7b, and total annual CEO compensation was reported as US$3.3m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$1.1m. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$5.1m.
Most shareholders would consider it a positive that Richard Adams takes less total compensation than the CEOs of most similar size companies, leaving more 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 United Bankshares has changed over time.
Is United Bankshares, Inc. Growing?
United Bankshares, Inc. has increased its earnings per share (EPS) by an average of 8.8% a year, over the last three years (using a line of best fit). In the last year, its revenue is down 1.7%.
I would prefer it if there was revenue growth, but the improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. It could be important to check this free visual depiction of what analysts expect for the future.
Has United Bankshares, Inc. Been A Good Investment?
United Bankshares, Inc. has generated a total shareholder return of 7.8% over three years, so most shareholders wouldn't be too disappointed. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
It appears that United Bankshares, Inc. remunerates its CEO below most similar sized companies.
Richard Adams receives relatively low remuneration compared to similar sized companies. But the company isn't exactly firing on all cylinders, from my perspective. But on this analysis I see no issue with the CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling United Bankshares (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.
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