Yahoo Finance It's Unlikely That The CEO Of Provident Financial Services, Inc. (NYSE:PFS) Will See A Huge Pay Rise This Year
Key Insights
Provident Financial Services' Annual General Meeting to take place on 25th of April
Total pay for CEO Tony Labozzetta includes US$818.3k salary
Total compensation is similar to the industry average
Provident Financial Services' EPS grew by 6.8% over the past three years while total shareholder loss over the past three years was 31%
Shareholders of Provident Financial Services, Inc. (NYSE:PFS) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 25th of April could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.
Check out our latest analysis for Provident Financial Services
Comparing Provident Financial Services, Inc.'s CEO Compensation With The Industry
According to our data, Provident Financial Services, Inc. has a market capitalization of US$1.0b, and paid its CEO total annual compensation worth US$2.1m over the year to December 2023. This means that the compensation hasn't changed much from last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$818k.
For comparison, other companies in the American Banks industry with market capitalizations ranging between US$400m and US$1.6b had a median total CEO compensation of US$2.0m. From this we gather that Tony Labozzetta is paid around the median for CEOs in the industry. Furthermore, Tony Labozzetta directly owns US$7.3m worth of shares in the company, implying that they are deeply invested in the company's success.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$818k | US$648k | 39% |
Other | US$1.3m | US$1.4m | 61% |
Total Compensation | US$2.1m | US$2.0m | 100% |
Talking in terms of the industry, salary represented approximately 45% of total compensation out of all the companies we analyzed, while other remuneration made up 55% of the pie. It's interesting to note that Provident Financial Services allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
Provident Financial Services, Inc.'s Growth
Provident Financial Services, Inc. has seen its earnings per share (EPS) increase by 6.8% a year over the past three years. Its revenue is down 9.2% over the previous year.
We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Provident Financial Services, Inc. Been A Good Investment?
The return of -31% over three years would not have pleased Provident Financial Services, Inc. shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
To Conclude...
Shareholders have not seen their shares grow in value, rather they have seen their shares decline. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.
Whatever your view on compensation, you might want to check if insiders are buying or selling Provident Financial Services shares (free trial).
Important note: Provident Financial Services 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.
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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.
