Here's What We Think About Oconee Federal Financial's (NASDAQ:OFED) CEO Pay

This article will reflect on the compensation paid to Curt Evatt who has served as CEO of Oconee Federal Financial Corp. (NASDAQ:OFED) since 2017. This analysis will also assess whether Oconee Federal Financial pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Oconee Federal Financial

Comparing Oconee Federal Financial Corp.'s CEO Compensation With the industry

At the time of writing, our data shows that Oconee Federal Financial Corp. has a market capitalization of US$136m, and reported total annual CEO compensation of US$347k for the year to June 2020. That's a modest increase of 6.5% on the prior year. In particular, the salary of US$259.6k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below US$200m, we found that the median total CEO compensation was US$528k. In other words, Oconee Federal Financial pays its CEO lower than the industry median. Moreover, Curt Evatt also holds US$1.7m worth of Oconee Federal Financial stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 58% of total compensation out of all the companies we analyzed, while other remuneration made up 42% of the pie. Oconee Federal Financial is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Oconee Federal Financial Corp.'s Growth Numbers

Over the last three years, Oconee Federal Financial Corp. has shrunk its earnings per share by 11% per year. Revenue was pretty flat on last year.

The decline in EPS is a bit concerning. And the flat revenue hardly impresses. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Oconee Federal Financial Corp. Been A Good Investment?

Since shareholders would have lost about 14% over three years, some Oconee Federal Financial Corp. investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

As we touched on above, Oconee Federal Financial Corp. is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Over the last three years, shareholder returns have been downright disappointing, and EPSgrowth has been equally disappointing. Although we wouldn’t say CEO compensation is high, it’s tough to foresee shareholders warming up to thoughts of a bump anytime soon.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 1 warning sign for Oconee Federal Financial that investors should look into moving forward.

Important note: Oconee Federal Financial 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.

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.

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