Jerry Champi became the CEO of FNCB Bancorp, Inc. (NASDAQ:FNCB) in 2016, 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 assess whether FNCB Bancorp pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
How Does Total Compensation For Jerry Champi Compare With Other Companies In The Industry?
Our data indicates that FNCB Bancorp, Inc. has a market capitalization of US$121m, and total annual CEO compensation was reported as US$657k for the year to December 2019. We note that's an increase of 17% above last year. Notably, the salary which is US$339.0k, represents most of the total compensation being paid.
For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$629k. So it looks like FNCB Bancorp compensates Jerry Champi in line with the median for the industry. What's more, Jerry Champi holds US$536k worth of shares in the company in their own name.
On an industry level, roughly 43% of total compensation represents salary and 57% is other remuneration. FNCB Bancorp pays out 52% of remuneration in the form of a salary, significantly higher than the industry average. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
A Look at FNCB Bancorp, Inc.'s Growth Numbers
FNCB Bancorp, Inc.'s earnings per share (EPS) grew 13% per year over the last three years. Its revenue is up 9.5% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has FNCB Bancorp, Inc. Been A Good Investment?
Since shareholders would have lost about 12% over three years, some FNCB Bancorp, Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
As previously discussed, Jerry is compensated close to the median for companies of its size, and which belong to the same industry. At the same time, the company has logged negative shareholder returns over the last three years. But on the bright side, EPS growth is positive over the same period. Considering positive EPS growth, we'd say compensation is fair, but shareholders may be wary of a bump in pay before the company logs positive returns.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 2 warning signs (and 1 which is a bit concerning) in FNCB Bancorp we think you should know about.
Switching gears from FNCB Bancorp, 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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