Joe Kiley became the CEO of First Financial Northwest, Inc. (NASDAQ:FFNW) in 2013. First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Joe Kiley’s Compensation Compare With Similar Sized Companies?
Our data indicates that First Financial Northwest, Inc. is worth US$146m, and total annual CEO compensation is US$678k. (This figure is for the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$451k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$470k.
As you can see, Joe Kiley is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean First Financial Northwest, Inc. is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at First Financial Northwest has changed over time.
Is First Financial Northwest, Inc. Growing?
On average over the last three years, First Financial Northwest, Inc. has grown earnings per share (EPS) by 22% each year (using a line of best fit). It saw its revenue drop -11% over the last year.
This demonstrates that the company has been improving recently. A good result. Revenue growth is a real positive for growth, but ultimately profits are more important.
Has First Financial Northwest, Inc. Been A Good Investment?
With a total shareholder return of 10% over three years, First Financial Northwest, Inc. shareholders would, in general, be reasonably content. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.
We compared the total CEO remuneration paid by First Financial Northwest, Inc., 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. We also note that, over the same time frame, shareholder returns haven’t been bad. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn’t call the CEO pay problematic. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at First Financial Northwest.
If you want to buy a stock that is better than First Financial Northwest, this free list of high return, low debt companies is a great place to look.
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If you spot an error that warrants correction, please contact the editor at email@example.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.