Yahoo Finance Shareholders May Be Wary Of Increasing Veritex Holdings, Inc.'s (NASDAQ:VBTX) CEO Compensation Package
Key Insights
Veritex Holdings' Annual General Meeting to take place on 15th of May
Total pay for CEO Charles Holland includes US$800.0k salary
The total compensation is similar to the average for the industry
Veritex Holdings' three-year loss to shareholders was 32% while its EPS was down 5.6% over the past three years
Shareholders will probably not be too impressed with the underwhelming results at Veritex Holdings, Inc. (NASDAQ:VBTX) recently. At the upcoming AGM on 15th of May, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.
See our latest analysis for Veritex Holdings
Comparing Veritex Holdings, Inc.'s CEO Compensation With The Industry
At the time of writing, our data shows that Veritex Holdings, Inc. has a market capitalization of US$1.1b, and reported total annual CEO compensation of US$2.4m for the year to December 2023. We note that's a decrease of 66% compared to last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$800k.
On comparing similar companies from the American Banks industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$1.9m. So it looks like Veritex Holdings compensates Charles Holland in line with the median for the industry. Furthermore, Charles Holland directly owns US$4.8m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$800k | US$800k | 33% |
Other | US$1.6m | US$6.5m | 67% |
Total Compensation | US$2.4m | US$7.3m | 100% |
On an industry level, roughly 45% of total compensation represents salary and 55% is other remuneration. It's interesting to note that Veritex Holdings allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
Veritex Holdings, Inc.'s Growth
Over the last three years, Veritex Holdings, Inc. has shrunk its earnings per share by 5.6% per year. Its revenue is down 10% over the previous year.
Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Veritex Holdings, Inc. Been A Good Investment?
The return of -32% over three years would not have pleased Veritex Holdings, Inc. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Veritex Holdings that you should be aware of before investing.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
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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.
