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Rob Ruhlman became the CEO of Preformed Line Products Company (NASDAQ:PLPC) in 2000. First, this article will compare CEO compensation with compensation at similar sized companies. 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. This method should give us information to assess how appropriately the company pays the CEO.
How Does Rob Ruhlman’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Preformed Line Products Company has a market cap of US$251m, and is paying total annual CEO compensation of US$4.3m. (This is based on the year to December 2018). That’s a fairly small increase of 2.9% on year before. While we always look at total compensation first, we note that the salary component is less, at US$867k. We examined companies with market caps from US$100m to US$400m, and discovered that the median CEO total compensation of that group was US$1.1m.
It would therefore appear that Preformed Line Products Company pays Rob Ruhlman more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see, below, how CEO compensation at Preformed Line Products has changed over time.
Is Preformed Line Products Company Growing?
Over the last three years Preformed Line Products Company has grown its earnings per share (EPS) by an average of 31% per year (using a line of best fit). In the last year, its revenue is up 7.2%.
This demonstrates that the company has been improving recently. A good result. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Although we don’t have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Preformed Line Products Company Been A Good Investment?
Preformed Line Products Company has generated a total shareholder return of 21% over three years, so most shareholders would be reasonably content. 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.
We examined the amount Preformed Line Products Company pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. Looking at the same time period, we think that the shareholder returns are respectable. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn’t call the CEO pay problematic. Whatever your view on compensation, you might want to check if insiders are buying or selling Preformed Line Products shares (free trial).
Important note: Preformed Line Products 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 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.