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Chuck Prow became the CEO of Vectrus, Inc. (NYSE:VEC) in 2016. 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. 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.
How Does Chuck Prow’s Compensation Compare With Similar Sized Companies?
Our data indicates that Vectrus, Inc. is worth US$419m, and total annual CEO compensation is US$3.2m. (This figure is for the year to December 2018). We note that’s an increase of 45% above last year. While we always look at total compensation first, we note that the salary component is less, at US$681k. We examined companies with market caps from US$200m to US$800m, and discovered that the median CEO total compensation of that group was US$1.8m.
Thus we can conclude that Chuck Prow receives more in total compensation than the median of a group of companies in the same market, and of similar size to Vectrus, Inc.. However, this doesn’t necessarily mean the pay 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 Vectrus has changed over time.
Is Vectrus, Inc. Growing?
Over the last three years Vectrus, Inc. has grown its earnings per share (EPS) by an average of 22% per year (using a line of best fit). It achieved revenue growth of 12% 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 decent revenue growth in the last year, suggesting the business is healthy and growing. You might want to check this free visual report on analyst forecasts for future earnings.
Has Vectrus, Inc. Been A Good Investment?
Boasting a total shareholder return of 41% over three years, Vectrus, Inc. has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
We compared the total CEO remuneration paid by Vectrus, Inc., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
However, the earnings per share growth over three years is certainly impressive. Even better, returns to shareholders have been plentiful, over the same time period. As a result of this good performance, the CEO remuneration may well be quite reasonable. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Vectrus (free visualization of insider trades).
If you want to buy a stock that is better than Vectrus, this free list of high return, low debt companies is a great place to look.
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.