Steve Steinour has been the CEO of Huntington Bancshares Incorporated (NASDAQ:HBAN) since 2009, and this article will examine the executive’s compensation with respect to the overall performance of the company. This analysis will also assess whether Huntington Bancshares pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
See our latest analysis for Huntington Bancshares
Comparing Huntington Bancshares Incorporated’s CEO Compensation With the industry
Our data indicates that Huntington Bancshares Incorporated has a market capitalization of US$12b, and total annual CEO compensation was reported as US$7.5m for the year to December 2019. Notably, that’s a decrease of 12% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$1.1m.
On comparing similar companies in the industry with market capitalizations above US$8.0b, we found that the median total CEO compensation was US$13m. That is to say, Steve Steinour is paid under the industry median. Furthermore, Steve Steinour directly owns US$70m worth of shares in the company, implying that they are deeply invested in the company’s success.
|
Component |
2019 |
2018 |
Proportion (2019) |
|
Salary |
US$1.1m |
US$1.1m |
15% |
|
Other |
US$6.4m |
US$7.5m |
85% |
|
Total Compensation |
US$7.5m |
US$8.6m |
100% |
Talking in terms of the industry, salary represented approximately 43% of total compensation out of all the companies we analyzed, while other remuneration made up 57% of the pie. It’s interesting to note that Huntington Bancshares allocates a smaller portion of compensation to salary in comparison to the broader industry. If non-salary compensation dominates total pay, it’s an indicator that the executive’s salary is tied to company performance.
Huntington Bancshares Incorporated’s Growth
Over the last three years, Huntington Bancshares Incorporated has shrunk its earnings per share by 5.2% per year. In the last year, its revenue is down 16%.
Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company’s future earnings..
Has Huntington Bancshares Incorporated Been A Good Investment?
With a total shareholder return of 1.9% over three years, Huntington Bancshares Incorporated has done okay by shareholders. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.
In Summary…
As previously discussed, Steve is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. Over the last three years, shareholder returns have been unexciting, and EPS growth has fared even worse. So, although we can’t say CEO compensation is very high, shareholders might want to see an improvement in overall performance before agreeing that Steve deserves a bump.
CEO compensation can have a massive impact on performance, but it’s just one element. We did our research and spotted 3 warning signs for Huntington Bancshares that investors should look into moving forward.
Switching gears from Huntington Bancshares, if you’re hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected].
