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Corey Chambas became the CEO of First Business Financial Services, Inc. (NASDAQ:FBIZ) in 2006, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Comparing First Business Financial Services, Inc.'s CEO Compensation With the industry
Our data indicates that First Business Financial Services, Inc. has a market capitalization of US$165m, and total annual CEO compensation was reported as US$1.2m for the year to December 2019. Notably, that's an increase of 65% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$466k.
In comparison with other companies in the industry with market capitalizations ranging from US$100m to US$400m, the reported median CEO total compensation was US$824k. This suggests that Corey Chambas is paid more than the median for the industry. What's more, Corey Chambas holds US$2.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
On an industry level, around 43% of total compensation represents salary and 57% is other remuneration. First Business Financial Services sets aside a smaller share of compensation for salary, in comparison to the overall 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 First Business Financial Services, Inc.'s Growth Numbers
First Business Financial Services, Inc.'s earnings per share (EPS) grew 12% per year over the last three years. In the last year, its revenue is up 2.3%.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has First Business Financial Services, Inc. Been A Good Investment?
With a three year total loss of 9.7% for the shareholders, First Business Financial Services, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.
As we touched on above, First Business Financial Services, Inc. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the company has impressed with its EPS growth, but it's disappointing to see negative shareholder returns over the same period. Considering overall performance, we can't say Corey is underpaid, in fact compensation is definitely on the higher side.
CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 1 warning sign for First Business Financial Services that investors should look into moving forward.
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.
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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