Key Things To Understand About Bell Financial Group's (ASX:BFG) CEO Pay Cheque

Alastair Provan became the CEO of Bell Financial Group Limited (ASX:BFG) in 1989, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for Bell Financial Group

Comparing Bell Financial Group Limited's CEO Compensation With the industry

According to our data, Bell Financial Group Limited has a market capitalization of AU$389m, and paid its CEO total annual compensation worth AU$894k over the year to December 2019. We note that's an increase of 13% above last year. In particular, the salary of AU$523.5k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations ranging from AU$143m to AU$572m, the reported median CEO total compensation was AU$896k. So it looks like Bell Financial Group compensates Alastair Provan in line with the median for the industry. Moreover, Alastair Provan also holds AU$5.8m worth of Bell Financial Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 62% of total compensation represents salary and 38% is other remuneration. Bell Financial Group is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Bell Financial Group Limited's Growth

Bell Financial Group Limited's earnings per share (EPS) grew 18% per year over the last three years. In the last year, its revenue is up 15%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Bell Financial Group Limited Been A Good Investment?

We think that the total shareholder return of 135%, over three years, would leave most Bell Financial Group Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

As we touched on above, Bell Financial Group Limited is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Few would be critical of the leadership, since returns have been juicy and earnings are moving in the right direction. Although the pay is close to the industry median, overall performance is excellent, so we don't think the CEO is paid too generously. Stockholders might even be okay with a bump in pay, seeing as how investor returns have been so strong.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for Bell Financial Group that investors should think about before committing capital to this stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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