How Does Fauquier Bankshares’ (NASDAQ:FBSS) CEO Pay Compare With Company Performance?

This article will reflect on the compensation paid to Marc Bogan who has served as CEO of Fauquier Bankshares, Inc. (NASDAQ:FBSS) since 2016. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Fauquier Bankshares.

Check out our latest analysis for Fauquier Bankshares

How Does Total Compensation For Marc Bogan Compare With Other Companies In The Industry?

Our data indicates that Fauquier Bankshares, Inc. has a market capitalization of US$55m, and total annual CEO compensation was reported as US$762k for the year to December 2019. That’s just a smallish increase of 7.5% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$328k.

In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$650k. So it looks like Fauquier Bankshares compensates Marc Bogan in line with the median for the industry. What’s more, Marc Bogan holds US$245k worth of shares in the company in their own name.

Component20192018Proportion (2019)
Salary US$328k US$319k 43%
Other US$434k US$390k 57%
Total CompensationUS$762k US$709k100%

Speaking on an industry level, nearly 43% of total compensation represents salary, while the remainder of 57% is other remuneration. Although there is a difference in how total compensation is set, Fauquier Bankshares more or less reflects the market in terms of setting the salary. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

NasdaqCM:FBSS CEO Compensation August 24th 2020

Fauquier Bankshares, Inc.’s Growth

Fauquier Bankshares, Inc.’s earnings per share (EPS) grew 26% per year over the last three years. In the last year, its revenue changed by just 0.6%.

Shareholders would be glad to know that the company has improved itself over the last few years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. While we don’t have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Fauquier Bankshares, Inc. Been A Good Investment?

With a three year total loss of 11% for the shareholders, Fauquier Bankshares, Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

As we noted earlier, Fauquier Bankshares pays its CEO in line with similar-sized companies belonging to the same industry. On the other hand, the company has logged negative shareholder returns over the previous three years. But EPS growth is moving in a favorable direction, certainly a positive sign. It’s tough for us to say CEO compensation is too generous when EPS growth is positive, but negative investor returns will irk shareholders and reduce any chances of a raise.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That’s why we did some digging and identified 1 warning sign for Fauquier Bankshares that investors should think about before committing capital to this stock.

Switching gears from Fauquier Bankshares, if you’re hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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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