Stock Analysis

We Think Some Shareholders May Hesitate To Increase Ducommun Incorporated's (NYSE:DCO) CEO Compensation

  •  Updated
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Under the guidance of CEO Steve Oswald, Ducommun Incorporated (NYSE:DCO) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 21 April 2021. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Ducommun

Comparing Ducommun Incorporated's CEO Compensation With the industry

According to our data, Ducommun Incorporated has a market capitalization of US$743m, and paid its CEO total annual compensation worth US$5.0m over the year to December 2020. We note that's a decrease of 13% compared to last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$899k.

On comparing similar companies from the same industry with market caps ranging from US$400m to US$1.6b, we found that the median CEO total compensation was US$1.8m. Hence, we can conclude that Steve Oswald is remunerated higher than the industry median. Furthermore, Steve Oswald directly owns US$17m worth of shares in the company, implying that they are deeply invested in the company's success.

Component20202019Proportion (2020)
Salary US$899k US$806k 18%
Other US$4.1m US$4.9m 82%
Total CompensationUS$5.0m US$5.7m100%

On an industry level, around 17% of total compensation represents salary and 83% is other remuneration. Our data reveals that Ducommun allocates salary more or less in line with the wider market. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

NYSE:DCO CEO Compensation April 15th 2021

A Look at Ducommun Incorporated's Growth Numbers

Ducommun Incorporated's earnings per share (EPS) grew 12% per year over the last three years. It saw its revenue drop 13% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Ducommun Incorporated Been A Good Investment?

We think that the total shareholder return of 99%, over three years, would leave most Ducommun Incorporated shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Ducommun that investors should think about before committing capital to this stock.

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.

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