John D'Angelo has been the CEO of Investar Holding Corporation (NASDAQ:ISTR) since 2013, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Comparing Investar Holding Corporation's CEO Compensation With the industry
At the time of writing, our data shows that Investar Holding Corporation has a market capitalization of US$140m, and reported total annual CEO compensation of US$966k for the year to December 2019. We note that's an increase of 13% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$473k.
For comparison, other companies in the industry with market capitalizations below US$200m, reported a median total CEO compensation of US$631k. Hence, we can conclude that John D'Angelo is remunerated higher than the industry median. Furthermore, John D'Angelo directly owns US$2.3m worth of shares in the company, implying that they are deeply invested in the company's success.
On an industry level, roughly 43% of total compensation represents salary and 57% is other remuneration. According to our research, Investar Holding has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
A Look at Investar Holding Corporation's Growth Numbers
Investar Holding Corporation has seen its earnings per share (EPS) increase by 6.2% a year over the past three years. It achieved revenue growth of 8.2% over the last year.
We're not particularly impressed by the revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. 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 Investar Holding Corporation Been A Good Investment?
Since shareholders would have lost about 41% over three years, some Investar Holding Corporation investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
As we noted earlier, Investar Holding pays its CEO higher than the norm for similar-sized companies belonging to the same industry. The growth in the business has been uninspiring, but the shareholder returns for Investar Holding have arguably been worse, over the last three years. And the situation doesn't look all that good when you see John is remunerated higher than the industry average. With such poor returns, we would understand if shareholders had concerns related to the CEO's pay.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for Investar Holding that you should be aware of before investing.
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. 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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