This Is The Reason Why We Think Value Line, Inc.'s (NASDAQ:VALU) CEO Deserves A Bump Up To Their Compensation

The solid performance at Value Line, Inc. (NASDAQ:VALU) has been impressive and shareholders will probably be pleased to know that CEO Howard Brecher has delivered. At the upcoming AGM on 08 October 2021, they will get a chance to hear the board review the company results, discuss future strategy and cast their vote on any resolutions such as executive remuneration. Let's take a look at why we think the CEO has done a good job and we'll present the case for a bump in pay.

Check out our latest analysis for Value Line

How Does Total Compensation For Howard Brecher Compare With Other Companies In The Industry?

At the time of writing, our data shows that Value Line, Inc. has a market capitalization of US$330m, and reported total annual CEO compensation of US$897k for the year to April 2021. That's just a smallish increase of 3.2% on last year. In particular, the salary of US$675.0k, makes up a huge portion of the total compensation being paid to the CEO.

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$2.4m. This suggests that Howard Brecher is paid below the industry median. What's more, Howard Brecher holds US$55k worth of shares in the company in their own name.

Component	2021	2020	Proportion (2021)
Salary	US$675k	US$650k	75%
Other	US$222k	US$220k	25%
Total Compensation	US$897k	US$870k	100%

On an industry level, roughly 13% of total compensation represents salary and 87% is other remuneration. Value Line is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Value Line, Inc.'s Growth Numbers

Value Line, Inc. has seen its earnings per share (EPS) increase by 16% a year over the past three years. It saw its revenue drop 1.9% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Value Line, Inc. Been A Good Investment?

Most shareholders would probably be pleased with Value Line, Inc. for providing a total return of 53% 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...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. However, investors will get the chance to engage on key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for Value Line you should be aware of, and 1 of them is concerning.

Important note: Value Line is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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