Shareholders Will Likely Find Kentucky First Federal Bancorp's (NASDAQ:KFFB) CEO Compensation Acceptable

Key Insights

• Kentucky First Federal Bancorp's Annual General Meeting to take place on 16th of November
• Total pay for CEO Don Jennings includes US$190.0k salary
• The overall pay is 69% below the industry average
• Kentucky First Federal Bancorp's EPS grew by 109% over the past three years while total shareholder loss over the past three years was 16%

Shareholders may be wondering what CEO Don Jennings plans to do to improve the less than great performance at Kentucky First Federal Bancorp (NASDAQ:KFFB) recently. At the next AGM coming up on 16th of November, they can influence managerial decision making through voting on resolutions, including executive remuneration. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We have prepared some analysis below to show that CEO compensation looks to be reasonable.

View our latest analysis for Kentucky First Federal Bancorp

Comparing Kentucky First Federal Bancorp's CEO Compensation With The Industry

According to our data, Kentucky First Federal Bancorp has a market capitalization of US$38m, and paid its CEO total annual compensation worth US$204k over the year to June 2023. That's slightly lower by 3.8% over the previous year. We note that the salary portion, which stands at US$190.0k constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the American Banks industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$663k. That is to say, Don Jennings is paid under the industry median. Moreover, Don Jennings also holds US$339k worth of Kentucky First Federal Bancorp stock directly under their own name.

Component	2023	2022	Proportion (2023)
Salary	US$190k	US$190k	93%
Other	US$14k	US$22k	7%
Total Compensation	US$204k	US$212k	100%

Talking in terms of the industry, salary represented approximately 43% of total compensation out of all the companies we analyzed, while other remuneration made up 57% of the pie. Kentucky First Federal Bancorp is paying a higher share of its remuneration through a salary in comparison to the overall industry. 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 Kentucky First Federal Bancorp's Growth Numbers

Kentucky First Federal Bancorp's earnings per share (EPS) grew 109% per year over the last three years. Its revenue is down 7.1% over the previous year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Kentucky First Federal Bancorp Been A Good Investment?

With a three year total loss of 16% for the shareholders, Kentucky First Federal Bancorp would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

The fact that shareholders have earned a negative share price return is certainly disconcerting. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. A key question may be why the fundamentals have not yet been reflected into the share price. In the upcoming AGM, shareholders should take this opportunity to raise these concerns with the board and revisit their investment thesis with regards to the company.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 3 warning signs for Kentucky First Federal 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.