A Quick Analysis On Southern First Bancshares' (NASDAQ:SFST) CEO Compensation

Art Seaver became the CEO of Southern First Bancshares, Inc. (NASDAQ:SFST) in 1999, 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 Southern First Bancshares pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Southern First Bancshares

How Does Total Compensation For Art Seaver Compare With Other Companies In The Industry?

According to our data, Southern First Bancshares, Inc. has a market capitalization of US$266m, and paid its CEO total annual compensation worth US$949k over the year to December 2019. We note that's a decrease of 9.2% compared to last year. We note that the salary portion, which stands at US$485.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from US$100m to US$400m, the reported median CEO total compensation was US$811k. From this we gather that Art Seaver is paid around the median for CEOs in the industry. Furthermore, Art Seaver directly owns US$2.6m 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. Southern First Bancshares is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Southern First Bancshares, Inc.'s Growth Numbers

Southern First Bancshares, Inc. has seen its earnings per share (EPS) increase by 1.5% a year over the past three years. Its revenue is down 5.5% over the previous year.

We would prefer it if there was revenue growth, but the modest improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Southern First Bancshares, Inc. Been A Good Investment?

With a three year total loss of 17% for the shareholders, Southern First Bancshares, Inc. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

As previously discussed, Art is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, Southern First Bancshares is suffering from adverse shareholder returns and althoughEPS have grown over the past three years, they have not been extraordinary. We'd stop short of saying CEO compensation is inappropriate, but without an improvement in performance, it's sure to draw criticism. Shareholders will also not want to see performance improving before agreeing to any raise.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 3 warning signs for Southern First Bancshares that investors should think about before committing capital to this stock.

Switching gears from Southern First Bancshares, 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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