Stock Analysis

It Looks Like The CEO Of The ONE Group Hospitality, Inc. (NASDAQ:STKS) May Be Underpaid Compared To Peers

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Shareholders will be pleased by the impressive results for The ONE Group Hospitality, Inc. (NASDAQ:STKS) recently and CEO Manny Hilario has played a key role. This would be kept in mind at the upcoming AGM on 09 June 2021 which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and probably deserves a well-earned pay rise.

See our latest analysis for ONE Group Hospitality

How Does Total Compensation For Manny Hilario Compare With Other Companies In The Industry?

According to our data, The ONE Group Hospitality, Inc. has a market capitalization of US$322m, and paid its CEO total annual compensation worth US$1.1m over the year to December 2020. Notably, that's a decrease of 46% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$466k.

On examining similar-sized companies in the industry with market capitalizations between US$200m and US$800m, we discovered that the median CEO total compensation of that group was US$2.0m. Accordingly, ONE Group Hospitality pays its CEO under the industry median. Furthermore, Manny Hilario directly owns US$14m worth of shares in the company, implying that they are deeply invested in the company's success.

Component20202019Proportion (2020)
Salary US$466k US$497k 44%
Other US$602k US$1.5m 56%
Total CompensationUS$1.1m US$2.0m100%

On an industry level, around 22% of total compensation represents salary and 78% is other remuneration. ONE Group Hospitality pays out 44% of remuneration in the form of a salary, significantly higher than the industry average. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

NasdaqCM:STKS CEO Compensation June 3rd 2021

A Look at The ONE Group Hospitality, Inc.'s Growth Numbers

The ONE Group Hospitality, Inc.'s earnings per share (EPS) grew 11% per year over the last three years. In the last year, its revenue is up 9.4%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 The ONE Group Hospitality, Inc. Been A Good Investment?

Most shareholders would probably be pleased with The ONE Group Hospitality, Inc. for providing a total return of 327% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 3 warning signs for ONE Group Hospitality that investors should be aware of in a dynamic business environment.

Switching gears from ONE Group Hospitality, 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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