Does Timberland Bancorp's (NASDAQ:TSBK) CEO Salary Compare Well With Industry Peers?

Mike Sand has been the CEO of Timberland Bancorp, Inc. (NASDAQ:TSBK) since 2003, 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.

View our latest analysis for Timberland Bancorp

How Does Total Compensation For Mike Sand Compare With Other Companies In The Industry?

Our data indicates that Timberland Bancorp, Inc. has a market capitalization of US$231m, and total annual CEO compensation was reported as US$685k for the year to September 2020. That's a notable increase of 36% on last year. Notably, the salary which is US$410.0k, represents most of the total compensation being paid.

On comparing similar companies from the same industry with market caps ranging from US$100m to US$400m, we found that the median CEO total compensation was US$783k. From this we gather that Mike Sand is paid around the median for CEOs in the industry. Furthermore, Mike Sand directly owns US$4.7m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 57% of total compensation represents salary and 43% is other remuneration. Although there is a difference in how total compensation is set, Timberland Bancorp more or less reflects the market in terms of setting the salary. 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.

Timberland Bancorp, Inc.'s Growth

Timberland Bancorp, Inc.'s earnings per share (EPS) grew 14% per year over the last three years. Revenue was pretty flat on last year.

Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Timberland Bancorp, Inc. Been A Good Investment?

Timberland Bancorp, Inc. has generated a total shareholder return of 6.4% over three years, so most shareholders wouldn't be too disappointed. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary...

As we touched on above, Timberland Bancorp, Inc. is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. However, it's admirable that over the last three years, EPS growth for the company has been impressive, though the same can't be said for investor returns. So considering these factors, we think the compensation is probably quite reasonable, but investor returns need a boost moving forward.

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 2 warning signs for Timberland Bancorp that you should be aware of before investing.

Switching gears from Timberland 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.

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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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