In 2014 David Trautman was appointed CEO of Park National Corporation (NYSEMKT:PRK). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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.
How Does David Trautman’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Park National Corporation has a market cap of US$1.5b, and is paying total annual CEO compensation of US$1.8m. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at US$785k. 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$4.1m.
A first glance this seems like a real positive for shareholders, since David Trautman is paid less than the average total compensation paid by similar sized companies. Though positive, it’s important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at Park National has changed from year to year.
Is Park National Corporation Growing?
Park National Corporation has increased its earnings per share (EPS) by an average of 8.8% a year, over the last three years (using a line of best fit). Its revenue is up 4.0% over last year.
I would argue that the improvement in revenue isn’t particularly impressive, but the modest improvement in EPS is good. So there are some positives here, but not enough to earn high praise.
Has Park National Corporation Been A Good Investment?
Park National Corporation has not done too badly by shareholders, with a total return of 3.9%, over three years. But they probably wouldn’t be so happy as to think the CEO should be paid more than is normal, for companies around this size.
It looks like Park National Corporation pays its CEO less than similar sized companies.
David Trautman is paid less than what is normal at similar size companies, and but overall performance has left me uninspired. However I do not find the CEO compensation to be concerning. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Park National.
Important note: Park National 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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