Equity Bancshares, Inc. (NASDAQ:EQBK) has not performed well recently and CEO Brad Elliott will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 27 April 2021. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.
Comparing Equity Bancshares, Inc.'s CEO Compensation With the industry
According to our data, Equity Bancshares, Inc. has a market capitalization of US$405m, and paid its CEO total annual compensation worth US$2.0m over the year to December 2020. That's a modest increase of 6.3% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$715k.
On examining similar-sized companies in the industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$1.1m. This suggests that Brad Elliott is paid more than the median for the industry. Moreover, Brad Elliott also holds US$6.6m worth of Equity Bancshares stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 42% of total compensation out of all the companies we analyzed, while other remuneration made up 58% of the pie. In Equity Bancshares' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Equity Bancshares, Inc.'s Growth Numbers
Over the last three years, Equity Bancshares, Inc. has shrunk its earnings per share by 74% per year. Revenue was pretty flat on last year.
Few shareholders would be pleased to read that EPS have declined. And the flat revenue is seriously uninspiring. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Equity Bancshares, Inc. Been A Good Investment?
With a three year total loss of 29% for the shareholders, Equity Bancshares, Inc. would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Equity Bancshares that investors should think about before committing capital to this stock.
Switching gears from Equity Bancshares, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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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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