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.
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.
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.
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