How Is Civista Bancshares' (NASDAQ:CIVB) CEO Compensated?

Dennis Shaffer became the CEO of Civista Bancshares, Inc. (NASDAQ:CIVB) in 2018, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Civista Bancshares pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Civista Bancshares

Comparing Civista Bancshares, Inc.'s CEO Compensation With the industry

Our data indicates that Civista Bancshares, Inc. has a market capitalization of US$208m, and total annual CEO compensation was reported as US$660k for the year to December 2019. Notably, that's an increase of 23% over the year before. In particular, the salary of US$407.7k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the same industry with market capitalizations ranging between US$100m and US$400m had a median total CEO compensation of US$892k. From this we gather that Dennis Shaffer is paid around the median for CEOs in the industry. Furthermore, Dennis Shaffer directly owns US$195k worth of shares in the company.

On an industry level, around 43% of total compensation represents salary and 57% is other remuneration. According to our research, Civista Bancshares has allocated a higher percentage of pay to salary in comparison to the wider industry. 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.

Civista Bancshares, Inc.'s Growth

Civista Bancshares, Inc.'s earnings per share (EPS) grew 5.0% per year over the last three years. In the last year, its revenue is up 5.2%.

We'd prefer higher revenue growth, but we're happy with the modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. 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 Civista Bancshares, Inc. Been A Good Investment?

Given the total shareholder loss of 35% over three years, many shareholders in Civista Bancshares, Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As we touched on above, Civista Bancshares, 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. This doesn't look good when you place it against the backdrop of negative shareholder returns and flat EPS growth. We'd stop short of saying CEO compensation is inappropriate, but without an improvement in performance, it's sure to draw criticism. Shareholders will also not want to see performance improving before agreeing to any raise.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 4 warning signs (and 1 which doesn't sit too well with us) in Civista Bancshares we think you should know about.

Important note: Civista Bancshares 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.

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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