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In 2001 Richard Hubbell was appointed CEO of Marine Products Corporation (NYSE:MPX). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. 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.
How Does Richard Hubbell’s Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Marine Products Corporation has a market cap of US$506m, and is paying total annual CEO compensation of US$1.2m. (This figure is for the year to December 2018). That’s a modest increase of 5.5% on the prior year year. While we always look at total compensation first, we note that the salary component is less, at US$500k. 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$1.7m.
Most shareholders would consider it a positive that Richard Hubbell takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it’s important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at Marine Products has changed from year to year.
Is Marine Products Corporation Growing?
On average over the last three years, Marine Products Corporation has grown earnings per share (EPS) by 26% each year (using a line of best fit). In the last year, its revenue is up 11%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. You might want to check this free visual report on analyst forecasts for future earnings.
Has Marine Products Corporation Been A Good Investment?
I think that the total shareholder return of 87%, over three years, would leave most Marine Products Corporation shareholders smiling. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.
Marine Products Corporation is currently paying its CEO below what is normal for companies of its size. Considering the underlying business is growing earnings, this would suggest the pay is modest. The strong history of shareholder returns might even have some thinking that Richard Hubbell deserves a raise!
It’s not often we see shareholders do so well, and yet the CEO is paid modestly. It would be even more positive if company insiders are buying shares. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Marine Products (free visualization of insider trades).
If you want to buy a stock that is better than Marine Products, this free list of high return, low debt companies is a great place to look.
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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.