In 1995 Richard Horowitz was appointed CEO of P&F Industries Inc (NASDAQ:PFIN). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Richard Horowitz’s Compensation Compare With Similar Sized Companies?
Our data indicates that P&F Industries Inc is worth US$30m, and total annual CEO compensation is US$2m. That’s a fairly small increase of 7.5% on year before. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO compensation in that group is US$287k.
It would therefore appear that P&F Industries Inc pays Richard Horowitz more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
Is P&F Industries Inc Growing?
On average over the last three years, P&F Industries Inc has shrunk earnings per share by 33% each year. It achieved revenue growth of 12% over the 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 wto 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.
Although we don’t have analyst forecasts, you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has P&F Industries Inc Been A Good Investment?
Given the total loss of 10.0% over three years, many shareholders in P&F Industries Inc are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
We examined the amount P&F Industries Inc pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.We think many shareholders would be underwhelmed with the business growth over the last three years.
Just as bad, share price gains for investors have failed to materialize, over the same period. In our opinion the CEO might be paid too generously! So you may want to check if insiders are buying P&F Industries Inc shares with their own money (free access).
Or you might rather take a peek at this analytical visualization of historic cash flow, earnings and revenue.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.