Michael Doar has been the CEO of Hurco Companies, Inc. (NASDAQ:HURC) since 2001. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Michael Doar’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Hurco Companies, Inc. has a market cap of US$218m, and is paying total annual CEO compensation of US$2.6m. (This figure is for the year to October 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$477k. We examined companies with market caps from US$100m to US$400m, and discovered that the median CEO total compensation of that group was US$1.2m.
It would therefore appear that Hurco Companies, Inc. pays Michael Doar more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Hurco Companies has changed from year to year.
Is Hurco Companies, Inc. Growing?
Hurco Companies, Inc. has increased its earnings per share (EPS) by an average of 24% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 11%.
This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business.
Has Hurco Companies, Inc. Been A Good Investment?
With a total shareholder return of 19% over three years, Hurco Companies, Inc. shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.
We compared the total CEO remuneration paid by Hurco Companies, Inc., and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. We also think investors are doing ok, over the same time period. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn’t call the CEO pay problematic. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Hurco Companies (free visualization of insider trades).
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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If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.