Steve Nielsen became the CEO of Dycom Industries, Inc. (NYSE:DY) in 1999. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Steve Nielsen’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Dycom Industries, Inc. has a market cap of US$1.5b, and is paying total annual CEO compensation of US$3.9m. (This is based on the year to January 2019). We think total compensation is more important but we note that the CEO salary is lower, at US$1.0m. When we examined a selection of companies with market caps ranging from US$1.0b to US$3.2b, we found the median CEO total compensation was US$4.0m.
That means Steve Nielsen receives fairly typical remuneration for the CEO of a company that size. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.
You can see, below, how CEO compensation at Dycom Industries has changed over time.
Is Dycom Industries, Inc. Growing?
Dycom Industries, Inc. has reduced its earnings per share by an average of 18% a year, over the last three years (measured with a line of best fit). Its revenue is up 10% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.
Has Dycom Industries, Inc. Been A Good Investment?
Given the total loss of 44% over three years, many shareholders in Dycom Industries, Inc. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
Steve Nielsen is paid around what is normal the leaders of comparable size companies.
The company isn’t growing EPS, and shareholder returns have been disappointing. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. Shareholders may want to check for free if Dycom Industries insiders are buying or selling shares.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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