How Is Investors Title's (NASDAQ:ITIC) CEO Paid Relative To Peers?

James Fine has been the CEO of Investors Title Company (NASDAQ:ITIC) since 1973, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Investors Title.

View our latest analysis for Investors Title

Comparing Investors Title Company's CEO Compensation With the industry

According to our data, Investors Title Company has a market capitalization of US$287m, and paid its CEO total annual compensation worth US$1.3m over the year to December 2019. That is, the compensation was roughly the same as last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$438k.

For comparison, other companies in the same industry with market capitalizations ranging between US$100m and US$400m had a median total CEO compensation of US$2.5m. This suggests that James Fine is paid below the industry median. Moreover, James Fine also holds US$30m worth of Investors Title stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 16% of total compensation represents salary and 84% is other remuneration. Investors Title pays out 35% of remuneration in the form of a salary, significantly higher than the industry average. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Investors Title Company's Growth Numbers

Investors Title Company has seen its earnings per share (EPS) increase by 17% a year over the past three years. It achieved revenue growth of 30% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Investors Title Company Been A Good Investment?

Given the total shareholder loss of 6.0% over three years, many shareholders in Investors Title Company are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

As previously discussed, James is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, the EPS growth over three years is certainly impressive. It's tough to criticize CEO compensation when the per-share EPS movement is positive. But shareholders will likely want to hold off on any raise for James until investor returns are positive.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Investors Title that investors should think about before committing capital to this stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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