Under the guidance of CEO Mark Tryniski, Community Bank System, Inc. (NYSE:CBU) has performed reasonably well recently. As shareholders go into the upcoming AGM on 13 May 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.
Comparing Community Bank System, Inc.'s CEO Compensation With the industry
According to our data, Community Bank System, Inc. has a market capitalization of US$4.3b, and paid its CEO total annual compensation worth US$5.2m over the year to December 2020. That's mostly flat as compared to the prior year's compensation. We think total compensation is more important but our data shows that the CEO salary is lower, at US$845k.
For comparison, other companies in the same industry with market capitalizations ranging between US$2.0b and US$6.4b had a median total CEO compensation of US$3.4m. This suggests that Mark Tryniski is paid more than the median for the industry. Moreover, Mark Tryniski also holds US$14m worth of Community Bank System stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Speaking on an industry level, nearly 42% of total compensation represents salary, while the remainder of 58% is other remuneration. Community Bank System pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Community Bank System, Inc.'s Growth
Over the last three years, Community Bank System, Inc. has not seen its earnings per share change much, though there is a slight positive movement. In the last year, its revenue is up 2.2%.
We would argue that the improvement in revenue is good, but isn't particularly impressive, but it is good to see modest EPS growth. Considering these factors we'd say performance has been pretty decent, though not amazing. 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 Community Bank System, Inc. Been A Good Investment?
We think that the total shareholder return of 46%, over three years, would leave most Community Bank System, Inc. shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 3 warning signs (and 1 which is concerning) in Community Bank System we think you should know about.
Important note: Community Bank System is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
If you decide to trade Community Bank System, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted
Valuation is complex, but we're helping make it simple.
Find out whether Community Bank System is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.View the Free Analysis
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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.