Yahoo Finance Why Prosperity Bancshares, Inc.'s (NYSE:PB) CEO Pay Matters To You
David Zalman became the CEO of Prosperity Bancshares, Inc. (NYSE:PB) in 2001. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for Prosperity Bancshares
How Does David Zalman's Compensation Compare With Similar Sized Companies?
According to our data, Prosperity Bancshares, Inc. has a market capitalization of US$6.7b, and paid its CEO total annual compensation worth US$4.9m over the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at US$944k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. We examined companies with market caps from US$4.0b to US$12b, and discovered that the median CEO total compensation of that group was US$6.5m.
So David Zalman receives a similar amount to the median CEO pay, amongst the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
The graphic below shows how CEO compensation at Prosperity Bancshares has changed from year to year.
Is Prosperity Bancshares, Inc. Growing?
On average over the last three years, Prosperity Bancshares, Inc. has grown earnings per share (EPS) by 7.8% each year (using a line of best fit). In the last year, its revenue is up 1.6%.
I'd prefer higher revenue growth, but I'm happy with the modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. It could be important to check this free visual depiction of what analysts expect for the future.
Has Prosperity Bancshares, Inc. Been A Good Investment?
Prosperity Bancshares, Inc. has generated a total shareholder return of 7.3% over three years, so most shareholders wouldn't be too disappointed. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
In Summary...
David Zalman is paid around the same as most CEOs of similar size companies.
The company isn't showing particularly great growth, and shareholder turns haven't been particularly inspiring in the last few years. While the CEO may not be underpaid, we don't think the pay is too generous either. So you may want to check if insiders are buying Prosperity Bancshares shares with their own money (free access).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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