Some Shareholders May Object To A Pay Rise For Five Star Bancorp's (NASDAQ:FSBC) CEO This Year

Key Insights

• Five Star Bancorp to hold its Annual General Meeting on 16th of May
• CEO James Beckwith's total compensation includes salary of US$608.7k
• The overall pay is 33% below the industry average
• Five Star Bancorp's three-year loss to shareholders was 1.8% while its EPS was down 17% over the past three years

Performance at Five Star Bancorp (NASDAQ:FSBC) has not been particularly rosy recently and shareholders will likely be holding CEO James Beckwith and the board accountable for this. At the upcoming AGM on 16th of May, shareholders may have the opportunity to influence management to turn the performance around by voting on resolutions such as executive remuneration and other matters. The data we gathered below shows that CEO compensation looks acceptable for now.

See our latest analysis for Five Star Bancorp

How Does Total Compensation For James Beckwith Compare With Other Companies In The Industry?

According to our data, Five Star Bancorp has a market capitalization of US$471m, and paid its CEO total annual compensation worth US$947k over the year to December 2023. That's mostly flat as compared to the prior year's compensation. In particular, the salary of US$608.7k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the American Banks industry with market capitalizations ranging from US$200m to US$800m, the reported median CEO total compensation was US$1.4m. This suggests that James Beckwith is paid below the industry median. What's more, James Beckwith holds US$11m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$609k	US$581k	64%
Other	US$339k	US$393k	36%
Total Compensation	US$947k	US$974k	100%

Talking in terms of the industry, salary represented approximately 45% of total compensation out of all the companies we analyzed, while other remuneration made up 55% of the pie. According to our research, Five Star Bancorp has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Five Star Bancorp's Growth

Five Star Bancorp has reduced its earnings per share by 17% a year over the last three years. Its revenue is up 2.2% over the last year.

The decline in EPS is a bit concerning. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Five Star Bancorp Been A Good Investment?

Given the total shareholder loss of 1.8% over three years, many shareholders in Five Star Bancorp are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

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. We've identified 2 warning signs for Five Star Bancorp that investors should be aware of in a dynamic business environment.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.