How Should Investors Feel About HD Supply Holdings Inc’s (NASDAQ:HDS) CEO Pay?

Joe DeAngelo became the CEO of HD Supply Holdings Inc (NASDAQ:HDS) in 2005. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for HD Supply Holdings

How Does Joe DeAngelo’s Compensation Compare With Similar Sized Companies?

According to our data, HD Supply Holdings Inc has a market capitalization of US$7.0b, and pays its CEO total annual compensation worth US$6.4m. (This is based on the year to 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$1.0m. We looked at a group of companies with market capitalizations from US$4.0b to US$12b, and the median CEO compensation was US$6.9m.

That means Joe DeAngelo receives fairly typical remuneration for the CEO of a company that size. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at HD Supply Holdings has changed over time.

NasdaqGS:HDS CEO Compensation November 27th 18
NasdaqGS:HDS CEO Compensation November 27th 18

Is HD Supply Holdings Inc Growing?

Over the last three years HD Supply Holdings Inc has shrunk its earnings per share by an average of 42% per year. Its revenue is up 12% over last year.

Unfortunately, earnings per share have trended lower over the last three years. And while it’s good to see some good revenue growth recently, the growth isn’t really fast enough for me to put aside my concerns around earnings. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO.

You might want to check this free visual report on analyst forecasts for future earnings.

Has HD Supply Holdings Inc Been A Good Investment?

HD Supply Holdings Inc has served shareholders reasonably well, with a total return of 21% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary…

Joe DeAngelo is paid around what is normal the leaders of comparable size companies.

We feel that earnings per share have been a bit disappointing, but and we don’t think the total returns are amazing. We do not think the CEO pay is a problem, but one might argue that the company should improve returns to shareholders before increasing it. Whatever your view on compensation, you might want to check if insiders are buying or selling HD Supply Holdings shares (free trial).

Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.