Yahoo Finance Here's Why IES Holdings, Inc.'s (NASDAQ:IESC) CEO Compensation Is The Least Of Shareholders' Concerns
CEO Jeff Gendell has done a decent job of delivering relatively good performance at IES Holdings, Inc. (NASDAQ:IESC) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 23 February 2023. We present our case of why we think CEO compensation looks fair.
View our latest analysis for IES Holdings
How Does Total Compensation For Jeff Gendell Compare With Other Companies In The Industry?
At the time of writing, our data shows that IES Holdings, Inc. has a market capitalization of US$851m, and reported total annual CEO compensation of US$2.2m for the year to September 2022. That's a notable decrease of 23% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$825k.
On examining similar-sized companies in the American Construction industry with market capitalizations between US$400m and US$1.6b, we discovered that the median CEO total compensation of that group was US$2.7m. This suggests that IES Holdings remunerates its CEO largely in line with the industry average. What's more, Jeff Gendell holds US$5.9m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2022 | 2021 | Proportion (2022) |
Salary | US$825k | US$750k | 37% |
Other | US$1.4m | US$2.1m | 63% |
Total Compensation | US$2.2m | US$2.9m | 100% |
Talking in terms of the industry, salary represented approximately 19% of total compensation out of all the companies we analyzed, while other remuneration made up 81% of the pie. IES Holdings pays out 37% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.
IES Holdings, Inc.'s Growth
IES Holdings, Inc. has seen its earnings per share (EPS) increase by 5.7% a year over the past three years. In the last year, its revenue is up 33%.
It's great to see that revenue growth is strong. Combined with modest EPS growth, we get a good impression of the company. We wouldn't say this is necessarily top notch growth, but it is certainly promising. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has IES Holdings, Inc. Been A Good Investment?
Boasting a total shareholder return of 68% over three years, IES Holdings, Inc. has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
In Summary...
Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.
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. That's why we did some digging and identified 2 warning signs for IES Holdings that investors should think about before committing capital to this stock.
Important note: IES Holdings 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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