Kate Duchene has been the CEO of Resources Connection, Inc. (NASDAQ:RECN) since 2016. First, this article will compare CEO compensation with compensation at similar sized companies. 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 Kate Duchene’s Compensation Compare With Similar Sized Companies?
Our data indicates that Resources Connection, Inc. is worth US$561m, and total annual CEO compensation is US$1.6m. (This number is for the twelve months until May 2018). While we always look at total compensation first, we note that the salary component is less, at US$583k. When we examined a selection of companies with market caps ranging from US$200m to US$800m, we found the median CEO total compensation was US$1.8m.
So Kate Duchene is paid around the average of the companies we looked at. 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 Resources Connection, below.
Is Resources Connection, Inc. Growing?
On average over the last three years, Resources Connection, Inc. has grown earnings per share (EPS) by 6.0% each year (using a line of best fit). Its revenue is up 12% over last year.
I would argue that the modest growth in revenue is a notable positive. And the improvement in earnings per share is modest but respectable. Although we’ll stop short of calling the stock a top performer, we think the company has potential.
Has Resources Connection, Inc. Been A Good Investment?
With a total shareholder return of 29% over three years, Resources Connection, Inc. shareholders would, in general, be reasonably content. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.
Kate Duchene is paid around what is normal the leaders of comparable size companies.
We think many would like to see better growth. While there is room for improvement, we haven’t seen evidence to suggest the pay is too generous. Whatever your view on compensation, you might want to check if insiders are buying or selling Resources Connection shares (free trial).
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity 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 firstname.lastname@example.org. 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.