In 2017 Lee Gibson was appointed CEO of Southside Bancshares, Inc. (NASDAQ:SBSI). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Lee Gibson’s Compensation Compare With Similar Sized Companies?
According to our data, Southside Bancshares, Inc. has a market capitalization of US$981m, and paid its CEO total annual compensation worth US$1.6m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$646k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$400m to US$1.6b. The median total CEO compensation was US$2.8m.
Most shareholders would consider it a positive that Lee Gibson takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Southside Bancshares has changed over time.
Is Southside Bancshares, Inc. Growing?
On average over the last three years, Southside Bancshares, Inc. has grown earnings per share (EPS) by 7.7% each year (using a line of best fit). In the last year, its revenue is up 1.3%.
I would argue that the improvement in revenue isn’t particularly impressive, but I’m happy with the modest EPS growth. So there are some positives here, but not enough to earn high praise. You might want to check this free visual report on analyst forecasts for future earnings.
Has Southside Bancshares, Inc. Been A Good Investment?
Given the total loss of 1.8% over three years, many shareholders in Southside Bancshares, Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
It appears that Southside Bancshares, Inc. remunerates its CEO below most similar sized companies.
Lee Gibson receives relatively low remuneration compared to similar sized companies. But the company isn’t exactly firing on all cylinders, and returns over three years are not good. Many shareholders would probably like to see improvements, but our analysis does not suggest that CEO compensation is too generous. Looking into other areas, we’ve picked out 2 warning signs for Southside Bancshares that investors should think about before committing capital to this stock.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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