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Joe Adams has been the CEO of FS Bancorp, Inc. (NASDAQ:FSBW) since 2011, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for FS Bancorp.
How Does Total Compensation For Joe Adams Compare With Other Companies In The Industry?
Our data indicates that FS Bancorp, Inc. has a market capitalization of US$170m, and total annual CEO compensation was reported as US$1.3m for the year to December 2019. That's a notable decrease of 20% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$475k.
For comparison, other companies in the same industry with market capitalizations ranging between US$100m and US$400m had a median total CEO compensation of US$866k. This suggests that Joe Adams is paid more than the median for the industry. Furthermore, Joe Adams directly owns US$1.6m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, roughly 58% of total compensation represents salary and 42% is other remuneration. It's interesting to note that FS Bancorp allocates a smaller portion of compensation to salary 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.
FS Bancorp, Inc.'s Growth
FS Bancorp, Inc. has seen its earnings per share (EPS) increase by 13% a year over the past three years. Its revenue is up 19% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has FS Bancorp, Inc. Been A Good Investment?
With a three year total loss of 19% for the shareholders, FS Bancorp, Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
As previously discussed, Joe is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, we must not forget that the EPS growth has been very strong, but shareholder returns — over the same period — have been disappointing. Although we'd stop short of calling it inappropriate, we think Joe is earning a very handsome sum.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for FS Bancorp (of which 2 make us uncomfortable!) that you should know about in order to have a holistic understanding of the stock.
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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