Yahoo Finance Should You Worry About Huttig Building Products Inc’s (NASDAQ:HBP) CEO Pay Cheque?
Jon Vrabely became the CEO of Huttig Building Products Inc (NASDAQ:HBP) in 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Huttig Building Products
How Does Jon Vrabely’s Compensation Compare With Similar Sized Companies?
According to our data, Huttig Building Products Inc has a market capitalization of US$75m, and pays its CEO total annual compensation worth US$927k. (This is based on the year to 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$600k. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO compensation in that group is US$296k.
As you can see, Jon Vrabely is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Huttig Building Products Inc is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Huttig Building Products has changed from year to year.
Is Huttig Building Products Inc Growing?
Huttig Building Products Inc has reduced its earnings per share by an average of 101% a year, over the last three years. In the last year, its revenue is up 11%.
Few shareholders would be pleased to read that earnings per share are lower over three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. 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 shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Huttig Building Products Inc Been A Good Investment?
With a three year total loss of 22%, Huttig Building Products Inc would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary…
We examined the amount Huttig Building Products Inc pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
We think many shareholders would be underwhelmed with the business growth over the last three years.
Arguably worse, investors are without a positive return for the last three years. This analysis suggests to us that the CEO is paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling Huttig Building Products shares (free trial).
Or you might prefer gaze upon this detailed graph of past earnings, revenue and cash flow .
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.