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Kevin Riley became the CEO of First Interstate BancSystem, Inc. (NASDAQ:FIBK) in 2015. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Kevin Riley's Compensation Compare With Similar Sized Companies?
Our data indicates that First Interstate BancSystem, Inc. is worth US$2.7b, and total annual CEO compensation was reported as US$2.5m for the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$741k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO total compensation was US$5.1m.
A first glance this seems like a real positive for shareholders, since Kevin Riley is paid less than the average total compensation paid by similar sized companies. Though positive, it's important we delve into the performance of the actual business.
You can see a visual representation of the CEO compensation at First Interstate BancSystem, below.
Is First Interstate BancSystem, Inc. Growing?
First Interstate BancSystem, Inc. has increased its earnings per share (EPS) by an average of 11% a year, over the last three years (using a line of best fit). Its revenue is up 13% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has First Interstate BancSystem, Inc. Been A Good Investment?
First Interstate BancSystem, Inc. has not done too badly by shareholders, with a total return of 9.7%, over three years. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
First Interstate BancSystem, Inc. is currently paying its CEO below what is normal for companies of its size.
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 Kevin Riley is overcompensated. It's great to see a company that pays its CEO reasonably, even while growing. It would be an additional positive if insiders are buying shares. So you may want to check if insiders are buying First Interstate BancSystem shares with their own money (free access).
If you want to buy a stock that is better than First Interstate BancSystem, this free list of high return, low debt companies is a great place to look.
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.
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