Is Mueller Water Products, Inc.’s (NYSE:MWA) CEO Pay Justified?

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In 2017 J. Hall was appointed CEO of Mueller Water Products, Inc. (NYSE:MWA). 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 process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for Mueller Water Products

How Does J. Hall’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Mueller Water Products, Inc. has a market cap of US$1.5b, and is paying total annual CEO compensation of US$3.2m. (This figure is for the year to September 2018). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$765k. 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$3.9m.

That means J. Hall receives fairly typical remuneration for the CEO of a company that size. While this data point isn’t particularly informative alone, it gains more meaning when considered with business performance.

You can see a visual representation of the CEO compensation at Mueller Water Products, below.

NYSE:MWA CEO Compensation, July 4th 2019
NYSE:MWA CEO Compensation, July 4th 2019

Is Mueller Water Products, Inc. Growing?

Mueller Water Products, Inc. has increased its earnings per share (EPS) by an average of 13% a year, over the last three years (using a line of best fit). It achieved revenue growth of 7.0% over the last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see modest revenue growth, suggesting the underlying business is healthy.

Has Mueller Water Products, Inc. Been A Good Investment?

Since shareholders would have lost about 11% over three years, some Mueller Water Products, Inc. shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

J. Hall is paid around what is normal the leaders of comparable size companies.

We like that the company is growing EPS, but we find the returns over the last three years to be lacking. We’d be surprised if shareholders want to see a pay rise for the CEO, but we’d stop short of calling their pay too generous. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Mueller Water Products.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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 editorial-team@simplywallst.com. 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.