Shareholders Will Likely Find Kingsway Financial Services Inc.'s (NYSE:KFS) CEO Compensation Acceptable

Key Insights

• Kingsway Financial Services to hold its Annual General Meeting on 19th of May
• CEO JT Fitzgerald's total compensation includes salary of US$600.0k
• The total compensation is 61% less than the average for the industry
• Kingsway Financial Services' total shareholder return over the past three years was 67% while its EPS was down 39% over the past three years

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Shareholders may be wondering what CEO JT Fitzgerald plans to do to improve the less than great performance at Kingsway Financial Services Inc. (NYSE:KFS) recently. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 19th of May. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. In our opinion, CEO compensation does not look excessive and we discuss why.

View our latest analysis for Kingsway Financial Services

Comparing Kingsway Financial Services Inc.'s CEO Compensation With The Industry

According to our data, Kingsway Financial Services Inc. has a market capitalization of US$248m, and paid its CEO total annual compensation worth US$637k over the year to December 2024. That's just a smallish increase of 4.4% on last year. Notably, the salary which is US$600.0k, represents most of the total compensation being paid.

On examining similar-sized companies in the American Insurance industry with market capitalizations between US$100m and US$400m, we discovered that the median CEO total compensation of that group was US$1.6m. This suggests that JT Fitzgerald is paid below the industry median. Furthermore, JT Fitzgerald directly owns US$14m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	US$600k	US$574k	94%
Other	US$37k	US$36k	6%
Total Compensation	US$637k	US$610k	100%

Talking in terms of the industry, salary represented approximately 14% of total compensation out of all the companies we analyzed, while other remuneration made up 86% of the pie. According to our research, Kingsway Financial Services has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Kingsway Financial Services Inc.'s Growth

Kingsway Financial Services Inc. has reduced its earnings per share by 39% a year over the last three years. In the last year, its revenue is up 6.7%.

Few shareholders would be pleased to read that EPS have declined. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Kingsway Financial Services Inc. Been A Good Investment?

Boasting a total shareholder return of 67% over three years, Kingsway Financial Services Inc. has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

While the return to shareholders does look promising, it's hard to ignore the lack of earnings growth and this makes us wonder if these strong returns can continue. Shareholders might want to question the board about these concerns, and revisit their investment thesis for the company.

So you may want to check if insiders are buying Kingsway Financial Services shares with their own money (free access).

Switching gears from Kingsway Financial Services, 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. 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.