Yahoo Finance Here's Why Marten Transport, Ltd.'s (NASDAQ:MRTN) CEO Compensation Is The Least Of Shareholders Concerns
Key Insights
Marten Transport to hold its Annual General Meeting on 7th of May
Salary of US$744.7k is part of CEO Tim Kohl's total remuneration
The total compensation is 80% less than the average for the industry
Marten Transport's total shareholder return over the past three years was 4.2% while its EPS was down 7.5% over the past three years
Shareholders may be wondering what CEO Tim Kohl plans to do to improve the less than great performance at Marten Transport, Ltd. (NASDAQ:MRTN) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 7th of May. It has been shown that setting appropriate executive remuneration incentivises the management to act in the interests of shareholders. In our opinion, CEO compensation does not look excessive and we discuss why.
Check out our latest analysis for Marten Transport
Comparing Marten Transport, Ltd.'s CEO Compensation With The Industry
According to our data, Marten Transport, Ltd. has a market capitalization of US$1.4b, and paid its CEO total annual compensation worth US$1.1m over the year to December 2023. We note that's a decrease of 35% compared to last year. We note that the salary portion, which stands at US$744.7k constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the American Transportation industry with market capitalizations ranging between US$1.0b and US$3.2b had a median total CEO compensation of US$5.4m. This suggests that Tim Kohl is paid below the industry median. What's more, Tim Kohl holds US$4.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
Component | 2023 | 2022 | Proportion (2023) |
Salary | US$745k | US$713k | 69% |
Other | US$339k | US$942k | 31% |
Total Compensation | US$1.1m | US$1.7m | 100% |
Talking in terms of the industry, salary represented approximately 15% of total compensation out of all the companies we analyzed, while other remuneration made up 85% of the pie. According to our research, Marten Transport has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Marten Transport, Ltd.'s Growth
Over the last three years, Marten Transport, Ltd. has shrunk its earnings per share by 7.5% per year. It saw its revenue drop 15% over the last year.
Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Marten Transport, Ltd. Been A Good Investment?
Marten Transport, Ltd. has not done too badly by shareholders, with a total return of 4.2%, over three years. It would be nice to see that metric improve in the future. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.
To Conclude...
Despite the positive returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about the stock keeping up its current momentum. Shareholders might want to question the board about these concerns, and revisit their investment thesis for the company.
While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Marten Transport that investors should think about before committing capital to this stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.
