What Can We Conclude About Marine Products' (NYSE:MPX) CEO Pay?

Richard Hubbell became the CEO of Marine Products Corporation (NYSE:MPX) in 2001, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Marine Products pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Marine Products

Comparing Marine Products Corporation's CEO Compensation With the industry

At the time of writing, our data shows that Marine Products Corporation has a market capitalization of US$562m, and reported total annual CEO compensation of US$1.2m for the year to December 2019. That is, the compensation was roughly the same as last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$550k.

On comparing similar companies from the same industry with market caps ranging from US$200m to US$800m, we found that the median CEO total compensation was US$1.2m. So it looks like Marine Products compensates Richard Hubbell in line with the median for the industry. What's more, Richard Hubbell holds US$19m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 26% of total compensation represents salary and 74% is other remuneration. Marine Products is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Marine Products Corporation's Growth

Marine Products Corporation has reduced its earnings per share by 5.2% a year over the last three years. In the last year, its revenue is down 29%.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Marine Products Corporation Been A Good Investment?

With a total shareholder return of 21% over three years, Marine Products Corporation shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

As previously discussed, Richard is compensated close to the median for companies of its size, and which belong to the same industry. Marine Products has had a poor showing when it comes to EPS growth, and it's tough to say that shareholder returns have done much to excite us. These figures do not go well against CEO compensation, which is more or less equal to the industry median. We wouldn't go as far as saying CEO compensation is inappropriate, but we don't think the executive is underpaid.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Marine Products that you should be aware of before investing.

Switching gears from Marine Products, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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