Is Kinsale Capital Group, Inc.'s (NASDAQ:KNSL) CEO Pay Fair?
In 2009 Michael Kehoe was appointed CEO of Kinsale Capital Group, Inc. (NASDAQ:KNSL). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
View our latest analysis for Kinsale Capital Group
How Does Michael Kehoe's Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that Kinsale Capital Group, Inc. has a market cap of US$2.4b, and reported total annual CEO compensation of US$1.7m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$500k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We examined companies with market caps from US$2.0b to US$6.4b, and discovered that the median CEO total compensation of that group was US$4.9m.
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 a visual representation of the CEO compensation at Kinsale Capital Group, below.
Is Kinsale Capital Group, Inc. Growing?
Over the last three years Kinsale Capital Group, Inc. has grown its earnings per share (EPS) by an average of 44% per year (using a line of best fit). It achieved revenue growth of 30% over the last year.
This demonstrates that the company has been improving recently. A good result. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Shareholders might be interested in this free visualization of analyst forecasts.
Has Kinsale Capital Group, Inc. Been A Good Investment?
I think that the total shareholder return of 250%, over three years, would leave most Kinsale Capital Group, Inc. shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
It appears that Kinsale Capital Group, Inc. remunerates its CEO below most similar sized companies.
Considering the underlying business is growing earnings, this would suggest the pay is modest. The strong history of shareholder returns might even have some thinking that Michael Kehoe deserves a raise! It is relatively rare to see a modestly paid CEO when performance is so impressive. It would be even more positive if company insiders are buying shares. Shareholders may want to check for free if Kinsale Capital Group insiders are buying or selling shares.
Important note: Kinsale Capital Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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.
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. Thank you for reading.
