Is Hooker Furniture Corporation’s (NASDAQ:HOFT) CEO Being Overpaid?

Paul Toms became the CEO of Hooker Furniture Corporation (NASDAQ:HOFT) in 2000. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.

See our latest analysis for Hooker Furniture

How Does Paul Toms’s Compensation Compare With Similar Sized Companies?

Our data indicates that Hooker Furniture Corporation is worth US$331m, and total annual CEO compensation is US$1.6m. (This figure is for the year to January 2018). While we always look at total compensation first, we note that the salary component is less, at US$415k. When we examined a selection of companies with market caps ranging from US$200m to US$800m, we found the median CEO total compensation was US$1.6m.

So Paul Toms 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 Hooker Furniture, below.

NasdaqGS:HOFT CEO Compensation, April 26th 2019
NasdaqGS:HOFT CEO Compensation, April 26th 2019

Is Hooker Furniture Corporation Growing?

On average over the last three years, Hooker Furniture Corporation has grown earnings per share (EPS) by 26% each year (using a line of best fit). Its revenue is up 10.0% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions. Shareholders might be interested in this free visualization of analyst forecasts.

Has Hooker Furniture Corporation Been A Good Investment?

Hooker Furniture Corporation has generated a total shareholder return of 19% over three years, so most shareholders would be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

In Summary…

Paul Toms is paid around what is normal the leaders of comparable size companies.

The company is growing EPS but shareholder returns have been sound but not amazing. So considering these factors, we think the CEO pay is probably quite reasonable. So you may want to check if insiders are buying Hooker Furniture shares with their own money (free access).

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.