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In a move to align with market standards, CBIZ, Inc. (NYSE:CBZ), a leader in business services with a market capitalization of $4.37 billion and annual revenue of $1.68 billion, has announced compensation adjustments for its top executives following its acquisition of Marcum LLP. According to InvestingPro data, the company’s stock is trading near its 52-week high of $89.25, reflecting strong market confidence in its growth strategy. This decision, made by the Compensation and Human Capital Committee of the Board of Directors on February 12, 2025, aims to bring executive pay closer to median levels in the industry, as confirmed by an independent compensation consultant’s market data.
The adjustments reflect CBIZ’s growth after the Marcum transaction, completed in the fourth quarter of 2024, which significantly increased the company’s scale. With revenue growth of 7.83% in the last twelve months and a healthy current ratio of 1.49, CBIZ maintains a strong financial position while keeping executive compensation below the median compared to peers. InvestingPro subscribers can access 12 additional key insights about CBIZ’s financial health and growth prospects through the comprehensive Pro Research Report.
Jerome P. Grisko, Jr., the company’s CEO, will now receive a base salary of $1,000,000, with a target of 117% of his base salary under the Executive Incentive Plan (EIP), and long-term incentive (LTI) grants valued at $5,199,100. Chris Spurio, President, will have a base salary of $875,000 with an 80% EIP target and $1,800,000 in LTI grants. Michael P. Kouzelos, the incoming Chief Operating Officer, will receive a base salary of $600,000, an 80% EIP target, and $1,220,000 in LTI grants.
The structure of the LTI grants remains consistent with prior years, split equally between time-based restricted stock units (RSUs) and performance share units (PSUs). However, a notable change is the increase in the maximum payout for PSU awards from 200% to 300% of the target, incentivizing executives to integrate Marcum successfully and achieve the anticipated benefits of the acquisition.
The company’s incoming Chief Financial Officer, Brad S. Lakhia, had his compensation package disclosed previously in a Form 8-K filed on December 3, 2024.
These developments, as reported in the company’s SEC filing, demonstrate CBIZ’s commitment to competitive compensation practices and its confidence in the executive team’s ability to drive value for shareholders through the Marcum integration. While the company maintains moderate debt levels with a debt-to-equity ratio of 0.61, InvestingPro analysis indicates the stock is currently trading at premium multiples, with a P/E ratio of 36.67 and an EV/EBITDA of 25.63, suggesting investors are pricing in significant growth expectations from the Marcum acquisition.
In other recent news, CBIZ, Inc. has announced an extension of its Share Repurchase Program, allowing the company to buy back up to 5 million shares. This program is set to continue until March 31, 2026, as approved by the company’s Board of Directors. The initiative permits CBIZ to repurchase shares on the open market, through private transactions, or via Rule 10b5-1 trading plans. This move follows CBIZ’s acquisition of Marcum LLP, with potential transactions involving former partners of Marcum LLP who may sell their shares within four years of the acquisition. The company has emphasized that the program does not obligate them to purchase a specific number of shares and can be suspended at any time. Funding for these repurchases is anticipated to come from CBIZ’s operating cash flow and potential borrowing under its credit facility. The Board believes this program is a strategic investment, aimed at delivering value to shareholders. This development underscores CBIZ’s confidence in its financial stability and its commitment to enhancing shareholder returns.
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