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In 2007 Tom Broughton was appointed CEO of ServisFirst Bancshares, Inc. (NASDAQ:SFBS). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Tom Broughton's Compensation Compare With Similar Sized Companies?
According to our data, ServisFirst Bancshares, Inc. has a market capitalization of US$1.8b, and pays its CEO total annual compensation worth US$1.4m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at US$475k. 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$3.9m.
Most shareholders would consider it a positive that Tom Broughton 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 a visual representation of the CEO compensation at ServisFirst Bancshares, below.
Is ServisFirst Bancshares, Inc. Growing?
On average over the last three years, ServisFirst Bancshares, Inc. has grown earnings per share (EPS) by 22% each year (using a line of best fit). In the last year, its revenue is up 15%.
This demonstrates that the company has been improving recently. A good result. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. You might want to check this free visual report on analyst forecasts for future earnings.
Has ServisFirst Bancshares, Inc. Been A Good Investment?
ServisFirst Bancshares, Inc. has generated a total shareholder return of 28% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
It looks like ServisFirst Bancshares, Inc. pays its CEO less than similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. The total shareholder return might not be amazing, but that doesn't mean that Tom Broughton is paid too much.
Few would complain about reasonable CEO remuneration when the business is growing earnings per share. It would be an additional positive if insiders are buying shares. Whatever your view on compensation, you might want to check if insiders are buying or selling ServisFirst Bancshares 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.