Is Arrow Financial Corporation’s (NASDAQ:AROW) CEO Paid At A Competitive Rate?

Tom Murphy became the CEO of Arrow Financial Corporation (NASDAQ:AROW) 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. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for Arrow Financial

How Does Tom Murphy’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Arrow Financial Corporation has a market cap of US$502m, and is paying total annual CEO compensation of US$816k. We note that’s an increase of 21% above last year. We examined companies with market caps from US$200m to US$800m, and discovered that the median CEO compensation of that group was US$1.5m.

Most shareholders would consider it a positive that Tom Murphy takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it’s important we delve into the performance of the actual business.

You can see a visual representation of the CEO compensation at Arrow Financial, below.

NasdaqGS:AROW CEO Compensation November 21st 18
NasdaqGS:AROW CEO Compensation November 21st 18

Is Arrow Financial Corporation Growing?

On average over the last three years, Arrow Financial Corporation has grown earnings per share (EPS) by 11% each year. It achieved revenue growth of 7.2% 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.

You might want to check this free visual report on analyst forecasts for future earnings.

Has Arrow Financial Corporation Been A Good Investment?

I think that the total shareholder return of 48%, over three years, would leave most Arrow Financial Corporation shareholders smiling. This strong performance might mean some shareholders don’t mind if the CEO is paid more than is normal for a company of its size.

In Summary…

It looks like Arrow Financial Corporation pays its CEO less than similar sized companies. Many would consider this to indicate that the pay is modest since the business is growing. The strong history of shareholder returns might even have some thinking that Tom Murphy deserves a raise!

Most shareholders like to see a modestly paid CEO combined with strong performance by the company. But it is even better if company insiders are also buying shares with their own money.

Or you might prefer examine intently this intuitive graph showing past earnings and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at