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Is Stifel Financial Corp.'s (NYSE:SF) CEO Overpaid Relative To Its Peers?

Simply Wall St

Ron Kruszewski became the CEO of Stifel Financial Corp. (NYSE:SF) in 1997. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. 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.

Check out our latest analysis for Stifel Financial

How Does Ron Kruszewski's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Stifel Financial Corp. has a market cap of US$4.1b, and is paying total annual CEO compensation of US$13m. (This number is for the twelve months until December 2017). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$200k. When we examined a selection of companies with market caps ranging from US$2.0b to US$6.4b, we found the median CEO total compensation was US$4.9m.

It would therefore appear that Stifel Financial Corp. pays Ron Kruszewski more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

The graphic below shows how CEO compensation at Stifel Financial has changed from year to year.

NYSE:SF CEO Compensation, April 10th 2019

Is Stifel Financial Corp. Growing?

Over the last three years Stifel Financial Corp. has grown its earnings per share (EPS) by an average of 53% per year (using a line of best fit). It achieved revenue growth of 2.8% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. It could be important to check this free visual depiction of what analysts expect for the future.

Has Stifel Financial Corp. Been A Good Investment?

I think that the total shareholder return of 101%, over three years, would leave most Stifel Financial Corp. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

We compared the total CEO remuneration paid by Stifel Financial Corp., and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. Even better, returns to shareholders have been plentiful, over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Stifel Financial.

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.

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 editorial-team@simplywallst.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. Thank you for reading.