Dave Nelson has been the CEO of West Bancorporation, Inc. (NASDAQ:WTBA) since 2010, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether West Bancorporation pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Comparing West Bancorporation, Inc.'s CEO Compensation With the industry
Our data indicates that West Bancorporation, Inc. has a market capitalization of US$284m, and total annual CEO compensation was reported as US$975k for the year to December 2019. That's a notable decrease of 9.8% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$436k.
On comparing similar companies from the same industry with market caps ranging from US$100m to US$400m, we found that the median CEO total compensation was US$913k. So it looks like West Bancorporation compensates Dave Nelson in line with the median for the industry. Moreover, Dave Nelson also holds US$2.2m worth of West Bancorporation stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Speaking on an industry level, nearly 43% of total compensation represents salary, while the remainder of 57% is other remuneration. West Bancorporation is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
West Bancorporation, Inc.'s Growth
Over the past three years, West Bancorporation, Inc. has seen its earnings per share (EPS) grow by 8.1% per year. Its revenue is up 8.4% over the last year.
We're not particularly impressed by the revenue growth, but it is good to see modest EPS growth. Considering these factors we'd say performance has been pretty decent, though not amazing. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has West Bancorporation, Inc. Been A Good Investment?
Given the total shareholder loss of 17% over three years, many shareholders in West Bancorporation, Inc. are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.
As we noted earlier, West Bancorporation pays its CEO in line with similar-sized companies belonging to the same industry. Meanwhile, West Bancorporation is suffering from adverse shareholder returns and althoughEPS have grown over the past three years, they have not been extraordinary. We'd stop short of saying CEO compensation is inappropriate, but without an improvement in performance, it's sure to draw criticism. Shareholders will also not want to see performance improving before agreeing to any raise.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for West Bancorporation that investors should look into moving forward.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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