Here's Why Shareholders May Want To Be Cautious With Increasing CrossFirst Bankshares, Inc.'s (NASDAQ:CFB) CEO Pay Packet

Key Insights

• CrossFirst Bankshares to hold its Annual General Meeting on 14th of May
• Salary of US$712.5k is part of CEO Mike Maddox's total remuneration
• Total compensation is similar to the industry average
• CrossFirst Bankshares' EPS grew by 51% over the past three years while total shareholder loss over the past three years was 8.9%

In the past three years, the share price of CrossFirst Bankshares, Inc. (NASDAQ:CFB) has struggled to generate growth for its shareholders. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 14th of May could be an opportunity for shareholders to bring these concerns to the board's attention. They could also influence management through voting on resolutions such as executive remuneration. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for CrossFirst Bankshares

How Does Total Compensation For Mike Maddox Compare With Other Companies In The Industry?

According to our data, CrossFirst Bankshares, Inc. has a market capitalization of US$643m, and paid its CEO total annual compensation worth US$1.9m over the year to December 2023. We note that's an increase of 18% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$713k.

In comparison with other companies in the American Banks industry with market capitalizations ranging from US$400m to US$1.6b, the reported median CEO total compensation was US$1.9m. This suggests that CrossFirst Bankshares remunerates its CEO largely in line with the industry average. Furthermore, Mike Maddox directly owns US$2.8m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	US$713k	US$616k	37%
Other	US$1.2m	US$1.0m	63%
Total Compensation	US$1.9m	US$1.6m	100%

Speaking on an industry level, nearly 45% of total compensation represents salary, while the remainder of 55% is other remuneration. It's interesting to note that CrossFirst Bankshares allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at CrossFirst Bankshares, Inc.'s Growth Numbers

CrossFirst Bankshares, Inc.'s earnings per share (EPS) grew 51% per year over the last three years. In the last year, its revenue is up 12%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's a real positive to see this sort of revenue growth in a single year. That suggests a healthy and growing business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has CrossFirst Bankshares, Inc. Been A Good Investment?

Since shareholders would have lost about 8.9% over three years, some CrossFirst Bankshares, Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

Shareholders may want to check for free if CrossFirst Bankshares insiders are buying or selling shares.

Important note: CrossFirst Bankshares 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.