Jeff Stopko has been the CEO of AmeriServ Financial, Inc. (NASDAQ:ASRV) since 2015, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Comparing AmeriServ Financial, Inc.'s CEO Compensation With the industry
At the time of writing, our data shows that AmeriServ Financial, Inc. has a market capitalization of US$51m, and reported total annual CEO compensation of US$605k for the year to December 2019. That's a notable increase of 13% on last year. Notably, the salary which is US$342.4k, represents most of the total compensation being paid.
On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$624k. From this we gather that Jeff Stopko is paid around the median for CEOs in the industry. Furthermore, Jeff Stopko directly owns US$249k worth of shares in the company.
On an industry level, roughly 43% of total compensation represents salary and 57% is other remuneration. AmeriServ Financial is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at AmeriServ Financial, Inc.'s Growth Numbers
AmeriServ Financial, Inc. has reduced its earnings per share by 2.7% a year over the last three years. In the last year, its revenue is down 3.5%.
Its a bit disappointing to see that the company has failed to grow its EPS. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 AmeriServ Financial, Inc. Been A Good Investment?
Given the total shareholder loss of 18% over three years, many shareholders in AmeriServ Financial, Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As previously discussed, Jeff is compensated close to the median for companies of its size, and which belong to the same industry. In the meantime, the company has reported declining EPS growth and shareholder returns over the last three years. We'd stop short of saying compensation is inappropriate, but we would understand if shareholders had questions regarding a future raise.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 3 warning signs for AmeriServ Financial that investors should look into moving forward.
Important note: AmeriServ Financial is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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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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