Greg Becker became the CEO of SVB Financial Group (NASDAQ:SIVB) in 2011. First, this article will compare CEO compensation with compensation at other large companies. Then we’ll look at a snap shot of the business growth. 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.
How Does Greg Becker’s Compensation Compare With Similar Sized Companies?
Our data indicates that SVB Financial Group is worth US$13b, and total annual CEO compensation is US$7.6m. (This figure is for the year to December 2018). That’s a notable increase of 25% on last year. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$954k. When we examined a group of companies with market caps over US$8.0b, we found that their median CEO total compensation was US$11m. There aren’t very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.
A first glance this seems like a real positive for shareholders, since Greg Becker is paid less than the average total compensation paid by other large companies. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at SVB Financial Group has changed over time.
Is SVB Financial Group Growing?
On average over the last three years, SVB Financial Group has grown earnings per share (EPS) by 36% each year (using a line of best fit). Its revenue is up 35% over last year.
This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has SVB Financial Group Been A Good Investment?
Boasting a total shareholder return of 124% over three years, SVB Financial Group 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.
It looks like SVB Financial Group pays its CEO less than the average at large companies. Many would consider this to indicate that the pay is modest since the business is growing. The pleasing shareholder returns are the cherry on top; you might even consider that Greg Becker deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. It would be even more positive if company insiders are buying shares. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling SVB Financial Group (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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