Does American Outdoor Brands Corporation's (NASDAQ:AOBC) CEO Salary Reflect Performance?
P. Debney became the CEO of American Outdoor Brands Corporation (NASDAQ:AOBC) in 2011. 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for American Outdoor Brands
How Does P. Debney's Compensation Compare With Similar Sized Companies?
According to our data, American Outdoor Brands Corporation has a market capitalization of US$331m, and paid its CEO total annual compensation worth US$3.8m over the year to April 2019. That's a notable increase of 69% on last year. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$749k. Importantly, there may be performance hurdles relating to the non-salary component of the total compensation. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$200m to US$800m. The median total CEO compensation was US$1.8m.
Thus we can conclude that P. Debney receives more in total compensation than the median of a group of companies in the same market, and of similar size to American Outdoor Brands Corporation. However, this doesn't necessarily mean the pay 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.
You can see, below, how CEO compensation at American Outdoor Brands has changed over time.
Is American Outdoor Brands Corporation Growing?
Over the last three years American Outdoor Brands Corporation has shrunk its earnings per share by an average of 73% per year (measured with a line of best fit). In the last year, its revenue is up 1.0%.
Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.
Has American Outdoor Brands Corporation Been A Good Investment?
Given the total loss of 78% over three years, many shareholders in American Outdoor Brands Corporation are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
We examined the amount American Outdoor Brands Corporation pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that 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. Notably, the CEO remuneration is actually up on last year. This analysis suggests to us that the CEO is paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling American Outdoor Brands shares (free trial).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.