This article will reflect on the compensation paid to Bill Brunson who has served as CEO of The National Security Group, Inc. (NASDAQ:NSEC) since 2000. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for National Security Group.
How Does Total Compensation For Bill Brunson Compare With Other Companies In The Industry?
At the time of writing, our data shows that The National Security Group, Inc. has a market capitalization of US$30m, and reported total annual CEO compensation of US$330k for the year to December 2019. This means that the compensation hasn't changed much from last year. We note that the salary portion, which stands at US$256.6k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$547k. Accordingly, National Security Group pays its CEO under the industry median. Moreover, Bill Brunson also holds US$5.3m worth of National Security Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 16% of total compensation out of all the companies we analyzed, while other remuneration made up 84% of the pie. National Security Group pays out 78% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at The National Security Group, Inc.'s Growth Numbers
Over the past three years, The National Security Group, Inc. has seen its earnings per share (EPS) grow by 31% per year. Its revenue is down 2.7% over the previous year.
This demonstrates that the company has been improving recently and is good news for the shareholders. 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 The National Security Group, Inc. Been A Good Investment?
Since shareholders would have lost about 5.2% over three years, some The National Security Group, Inc. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
As we touched on above, The National Security Group, Inc. is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Importantly though, the company has impressed with its EPS growth over three years. Although we would've liked to see positive investor returns, it would be bold of us to criticize CEO compensation when EPS are up. But shareholders will likely want to hold off on any raise for Bill until investor returns are positive.
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 identified 4 warning signs for National Security Group (2 are a bit concerning!) that you should be aware of before investing here.
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.
If you’re looking to trade National Security Group, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account.
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 firstname.lastname@example.org.