Is Standex International Corporation’s (NYSE:SXI) CEO Being Overpaid?

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In 2014 David Dunbar was appointed CEO of Standex International Corporation (NYSE:SXI). 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. 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.

View our latest analysis for Standex International

How Does David Dunbar’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Standex International Corporation has a market cap of US$878m, and is paying total annual CEO compensation of US$3.4m. (This is based on the year to June 2018). While we always look at total compensation first, we note that the salary component is less, at US$797k. When we examined a selection of companies with market caps ranging from US$400m to US$1.6b, we found the median CEO total compensation was US$2.7m.

So David Dunbar receives a similar amount to the median CEO pay, amongst the companies we looked at. 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 a visual representation of the CEO compensation at Standex International, below.

NYSE:SXI CEO Compensation, June 14th 2019
NYSE:SXI CEO Compensation, June 14th 2019

Is Standex International Corporation Growing?

On average over the last three years, Standex International Corporation has shrunk earnings per share by 6.9% each year (measured with a line of best fit). Its revenue is up 13% over last year.

Sadly for shareholders, earnings per share are actually down, over three years. There’s no doubt that the silver lining is that revenue is up. But it isn’t sufficiently fast growth to overlook the fact that earnings per share has gone backwards over three years. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.

Has Standex International Corporation Been A Good Investment?

Since shareholders would have lost about 19% over three years, some Standex International Corporation shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

David Dunbar is paid around the same as most CEOs of similar size companies.

After looking at EPS and total shareholder returns, it’s certainly hard to argue the company has performed well, since both metrics are down. Suffice it to say, we don’t think the CEO is underpaid! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Standex International (free visualization of insider trades).

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 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.