Is Chuy’s Holdings, Inc. (NASDAQ:CHUY) Excessively Paying Its CEO?

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Steve Hislop became the CEO of Chuy’s Holdings, Inc. (NASDAQ:CHUY) in 2007. 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.

See our latest analysis for Chuy’s Holdings

How Does Steve Hislop’s Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Chuy’s Holdings, Inc. has a market cap of US$382m, and is paying total annual CEO compensation of US$1.4m. (This number is for the twelve months until December 2018). That’s just a smallish increase of 7.8% on last year. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$650k. 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$1.8m.

So Steve Hislop is paid around the average of 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 Chuy’s Holdings, below.

NasdaqGS:CHUY CEO Compensation, June 19th 2019
NasdaqGS:CHUY CEO Compensation, June 19th 2019

Is Chuy’s Holdings, Inc. Growing?

Chuy’s Holdings, Inc. has reduced its earnings per share by an average of 3.0% a year, over the last three years (measured with a line of best fit). Its revenue is up 8.0% over last year.

Unfortunately there is a complete lack of earnings per share improvement, over three years. And the modest revenue growth over 12 months isn’t much comfort against the reduced earnings per share. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Shareholders might be interested in this free visualization of analyst forecasts.

Has Chuy’s Holdings, Inc. Been A Good Investment?

Given the total loss of 36% over three years, many shareholders in Chuy’s Holdings, Inc. 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…

Steve Hislop is paid around the same as most CEOs of similar size companies.

After looking at EPS and total shareholder returns, it’s certainly hard to argue the company has performed well, since both metrics are down. Suffice it to say, we don’t think the CEO is underpaid! Shareholders may want to check for free if Chuy’s Holdings insiders are buying or selling shares.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.

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.