Here's Why Southern Missouri Bancorp, Inc.'s (NASDAQ:SMBC) CEO May Deserve A Raise

The impressive results at Southern Missouri Bancorp, Inc. (NASDAQ:SMBC) recently will be great news for shareholders. At the upcoming AGM on 25 October 2021, they will get a chance to hear the board review the company results, discuss future strategy and cast their vote on any resolutions such as executive remuneration. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

Check out our latest analysis for Southern Missouri Bancorp

How Does Total Compensation For Greg Steffens Compare With Other Companies In The Industry?

Our data indicates that Southern Missouri Bancorp, Inc. has a market capitalization of US$419m, and total annual CEO compensation was reported as US$596k for the year to June 2021. That's a modest increase of 5.5% on the prior year. In particular, the salary of US$400.7k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations ranging from US$200m to US$800m, the reported median CEO total compensation was US$1.5m. Accordingly, Southern Missouri Bancorp pays its CEO under the industry median. Moreover, Greg Steffens also holds US$14m worth of Southern Missouri Bancorp stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 51% of total compensation represents salary and 49% is other remuneration. Southern Missouri Bancorp pays out 67% of remuneration in the form of a salary, significantly higher than the industry average. 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 Missouri Bancorp, Inc.'s Growth Numbers

Southern Missouri Bancorp, Inc.'s earnings per share (EPS) grew 30% per year over the last three years. In the last year, its revenue is up 29%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Southern Missouri Bancorp, Inc. Been A Good Investment?

Most shareholders would probably be pleased with Southern Missouri Bancorp, Inc. for providing a total return of 37% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

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 1 warning sign for Southern Missouri Bancorp that investors should think about before committing capital to this stock.

Switching gears from Southern Missouri Bancorp, 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.

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.

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