Chris Martin has been the CEO of Provident Financial Services, Inc. (NYSE:PFS) since 2009. 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Chris Martin's Compensation Compare With Similar Sized Companies?
Our data indicates that Provident Financial Services, Inc. is worth US$1.7b, and total annual CEO compensation was reported as US$2.2m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$739k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO total compensation was US$4.1m.
Most shareholders would consider it a positive that Chris Martin takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business.
You can see, below, how CEO compensation at Provident Financial Services has changed over time.
Is Provident Financial Services, Inc. Growing?
Over the last three years Provident Financial Services, Inc. has grown its earnings per share (EPS) by an average of 12% per year (using a line of best fit). Its revenue is up 9.3% over last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to check this free visual report on analyst forecasts for future earnings.
Has Provident Financial Services, Inc. Been A Good Investment?
Provident Financial Services, Inc. has served shareholders reasonably well, with a total return of 29% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
It appears that Provident Financial Services, Inc. remunerates its CEO below most similar sized companies.
Considering the underlying business is growing earnings, this would suggest the pay is modest. While some might be keen on seeing higher returns, our short analysis has not produced any evidence to suggest Chris Martin is overcompensated. Few would complain about reasonable CEO remuneration when the business is growing earnings per share. But for me, it's even better if insiders are also buying shares with their own cold, hard, cash. Whatever your view on compensation, you might want to check if insiders are buying or selling Provident Financial Services shares (free trial).
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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If you spot an error that warrants correction, please contact the editor at email@example.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. Thank you for reading.