Jeff Hilzinger has been the CEO of Marlin Business Services Corp. (NASDAQ:MRLN) since 2016, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Marlin Business Services pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Comparing Marlin Business Services Corp.'s CEO Compensation With the industry
At the time of writing, our data shows that Marlin Business Services Corp. has a market capitalization of US$116m, and reported total annual CEO compensation of US$1.9m for the year to December 2019. Notably, that's an increase of 13% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$544k.
In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$544k. Hence, we can conclude that Jeff Hilzinger is remunerated higher than the industry median. Furthermore, Jeff Hilzinger directly owns US$654k worth of shares in the company.
On an industry level, around 25% of total compensation represents salary and 75% is other remuneration. Marlin Business Services pays out 28% of remuneration in the form of a salary, significantly higher than the industry average. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
Marlin Business Services Corp.'s Growth
Over the last three years, Marlin Business Services Corp. has shrunk its earnings per share by 38% per year. It saw its revenue drop 47% over the last year.
The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Marlin Business Services Corp. Been A Good Investment?
Since shareholders would have lost about 53% over three years, some Marlin Business Services Corp. investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.
As previously discussed, Jeff is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Unfortunately, this doesn't look great when you see shareholder returns have been negative over the last three years. To make matters worse, EPS growth has also been negative during this period. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 3 warning signs (and 1 which can't be ignored) in Marlin Business Services we think you should know about.
Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.
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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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