What We Learned About International Bancshares' (NASDAQ:IBOC) CEO Compensation
Dennis Nixon has been the CEO of International Bancshares Corporation (NASDAQ:IBOC) since 1979, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
View our latest analysis for International Bancshares
Comparing International Bancshares Corporation's CEO Compensation With the industry
At the time of writing, our data shows that International Bancshares Corporation has a market capitalization of US$1.9b, and reported total annual CEO compensation of US$2.1m for the year to December 2019. This means that the compensation hasn't changed much from last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$660k.
In comparison with other companies in the industry with market capitalizations ranging from US$1.0b to US$3.2b, the reported median CEO total compensation was US$2.6m. From this we gather that Dennis Nixon is paid around the median for CEOs in the industry. Furthermore, Dennis Nixon directly owns US$64m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2019 | 2018 | Proportion (2019) |
Salary | US$660k | US$660k | 31% |
Other | US$1.5m | US$1.4m | 69% |
Total Compensation | US$2.1m | US$2.1m | 100% |
Talking in terms of the industry, salary represented approximately 43% of total compensation out of all the companies we analyzed, while other remuneration made up 57% of the pie. In International Bancshares' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at International Bancshares Corporation's Growth Numbers
International Bancshares Corporation has seen its earnings per share (EPS) increase by 6.0% a year over the past three years. It saw its revenue drop 11% over the last year.
We would prefer it if there was revenue growth, but the modest improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has International Bancshares Corporation Been A Good Investment?
Since shareholders would have lost about 17% over three years, some International Bancshares Corporation investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.
To Conclude...
As previously discussed, Dennis is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, International Bancshares is suffering from adverse shareholder returns and althoughEPS have grown over the past three years, they have not been extraordinary. CEO pay isn't exceptionally high, but considering poor performance, shareholders will likely hold off support for a raise until results improve.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for International Bancshares that investors should look into moving forward.
Switching gears from International Bancshares, 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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