Is Hawthorn Bancshares, Inc.’s (NASDAQ:HWBK) CEO Salary Justified?

David Turner became the CEO of Hawthorn Bancshares, Inc. (NASDAQ:HWBK) in 2011. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Hawthorn Bancshares

How Does David Turner’s Compensation Compare With Similar Sized Companies?

According to our data, Hawthorn Bancshares, Inc. has a market capitalization of US$145m, and pays its CEO total annual compensation worth US$844k. (This figure is for the year to December 2017). While we always look at total compensation first, we note that the salary component is less, at US$462k. We looked at a group of companies with market capitalizations under US$200m, and the median CEO total compensation was US$427k.

As you can see, David Turner is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Hawthorn Bancshares, Inc. is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see, below, how CEO compensation at Hawthorn Bancshares has changed over time.

NasdaqGS:HWBK CEO Compensation, April 4th 2019
NasdaqGS:HWBK CEO Compensation, April 4th 2019

Is Hawthorn Bancshares, Inc. Growing?

On average over the last three years, Hawthorn Bancshares, Inc. has shrunk earnings per share by 10% each year (measured with a line of best fit). Its revenue is up 5.2% over last year.

Few shareholders would be pleased to read that earnings per share are lower over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don’t have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Hawthorn Bancshares, Inc. Been A Good Investment?

Boasting a total shareholder return of 89% over three years, Hawthorn Bancshares, Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary…

We compared total CEO remuneration at Hawthorn Bancshares, Inc. with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.

Neither earnings per share nor revenue have been growing sufficiently fast to impress us, over the last three years.

On the other hand, returns have been good, so the company is doing something right. Considering this, shareholders are probably not too worried about the CEO compensation. So you may want to check if insiders are buying Hawthorn Bancshares shares with their own money (free access).

If you want to buy a stock that is better than Hawthorn Bancshares, this free list of high return, low debt companies is a great place to look.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.

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