Is OceanFirst Financial Corp.’s (NASDAQ:OCFC) CEO Pay Justified?

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Chris Maher became the CEO of OceanFirst Financial Corp. (NASDAQ:OCFC) in 2015. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for OceanFirst Financial

How Does Chris Maher’s Compensation Compare With Similar Sized Companies?

According to our data, OceanFirst Financial Corp. has a market capitalization of US$1.2b, and pays its CEO total annual compensation worth US$2.0m. (This number is for the twelve months until 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$650k. When we examined a selection of companies with market caps ranging from US$400m to US$1.6b, we found the median CEO compensation was US$2.2m.

That means Chris Maher receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn’t tell us a great deal, it becomes more relevant when considered against the business performance.

You can see a visual representation of the CEO compensation at OceanFirst Financial, below.

Is OceanFirst Financial Corp. Growing?

Over the last three years OceanFirst Financial Corp. has grown its earnings per share (EPS) by an average of 6.9% per year (using a line of best fit). In the last year, its revenue is up 42%.

It’s great to see that revenue growth is strong. Combined with modest EPS growth, we get a good impression of the company. I’d stop short of saying the business performance is amazing, but there are enough positives to justify further research, or even adding the stock to your watch-list. You might want to check this free visual report on analyst forecasts for future earnings.

Has OceanFirst Financial Corp. Been A Good Investment?

Boasting a total shareholder return of 57% over three years, OceanFirst Financial Corp. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

Remuneration for Chris Maher is close enough to the median pay for a CEO of a similar sized company .

While the growth could be better, the shareholder returns are clearly good. So all things considered I’d venture that the CEO pay is appropriate. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling OceanFirst Financial (free visualization of insider trades).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.