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Is Minerals Technologies Inc.'s (NYSE:MTX) CEO Pay Justified?
In 2016 Doug Dietrich was appointed CEO of Minerals Technologies Inc. (NYSE:MTX). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we'll consider growth that the business demonstrates. 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.
See our latest analysis for Minerals Technologies
How Does Doug Dietrich's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Minerals Technologies Inc. has a market cap of US$1.7b, and is paying total annual CEO compensation of US$4.8m. (This is based on the year to December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$898k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$4.1m.
That means Doug Dietrich receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
You can see a visual representation of the CEO compensation at Minerals Technologies, below.
Is Minerals Technologies Inc. Growing?
Over the last three years Minerals Technologies Inc. has grown its earnings per share (EPS) by an average of 14% per year (using a line of best fit). It achieved revenue growth of 3.5% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see modest revenue growth, suggesting the underlying business is healthy.
Has Minerals Technologies Inc. Been A Good Investment?
Since shareholders would have lost about 33% over three years, some Minerals Technologies Inc. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Doug Dietrich is paid around what is normal the leaders of comparable size companies.
We think that the EPS growth is very pleasing, but we find the returns over the last three years to be lacking. Considering the improvement in earnings per share, one could argue that the CEO pay is appropriate, albeit not too low. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Minerals Technologies (free visualization of insider trades).
Important note: Minerals Technologies may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.
M
The Foxhole
When oil spikes, crude gets the attention. I think the boring refiner in the middle is where it gets interesting, and a record shows why.
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Andrew LeggetMarket Insights
Great earnings season, but are the earnings real?
At first glance, this was the strongest earnings season in years. But when you look at where the growth actually came from, the story splits into two very different pictures.
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About NYSE:MTX
Minerals Technologies
Develops, produces, and markets various mineral, mineral-based products and services.
Undervalued with excellent balance sheet.
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