Most Shareholders Will Probably Find That The Compensation For Kentucky First Federal Bancorp's (NASDAQ:KFFB) CEO Is Reasonable
Key Insights
Kentucky First Federal Bancorp will host its Annual General Meeting on 16th of November
CEO Don Jennings' total compensation includes salary of US$190.0k
Total compensation is 69% below industry average
Over the past three years, Kentucky First Federal Bancorp's EPS grew by 109% and over the past three years, the total loss to shareholders 16%
Performance at Kentucky First Federal Bancorp (NASDAQ:KFFB) has been rather uninspiring recently and shareholders may be wondering how CEO Don Jennings plans to fix this. At the next AGM coming up on 16th of November, they can influence managerial decision making through voting on resolutions, including executive remuneration. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. In our opinion, CEO compensation does not look excessive and we discuss why.
Check out our latest analysis for Kentucky First Federal Bancorp
Comparing Kentucky First Federal Bancorp's CEO Compensation With The Industry
At the time of writing, our data shows that Kentucky First Federal Bancorp has a market capitalization of US$38m, and reported total annual CEO compensation of US$204k for the year to June 2023. That's a slight decrease of 3.8% on the prior year. In particular, the salary of US$190.0k, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the American Banks industry with market capitalizations under US$200m, the reported median total CEO compensation was US$663k. In other words, Kentucky First Federal Bancorp pays its CEO lower than the industry median. Furthermore, Don Jennings directly owns US$339k worth of shares in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$190k | US$190k | 93% |
Other | US$14k | US$22k | 7% |
Total Compensation | US$204k | US$212k | 100% |
Speaking on an industry level, nearly 43% of total compensation represents salary, while the remainder of 57% is other remuneration. Kentucky First Federal Bancorp pays out 93% of remuneration in the form of a salary, significantly higher than the industry average. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
Kentucky First Federal Bancorp's Growth
Kentucky First Federal Bancorp's earnings per share (EPS) grew 109% per year over the last three years. It saw its revenue drop 7.1% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Kentucky First Federal Bancorp Been A Good Investment?
With a three year total loss of 16% for the shareholders, Kentucky First Federal Bancorp would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
The fact that shareholders are sitting on a loss is certainly disheartening. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. A key focus for the board and management will be how to align the share price with fundamentals. In the upcoming AGM, shareholders will get the opportunity to discuss these concerns with the board and assess if the board's plan is likely to improve company performance.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 3 warning signs for Kentucky First Federal Bancorp that investors should look into moving forward.
Switching gears from Kentucky First Federal Bancorp, 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.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
