Should You Worry About Hallador Energy Company’s (NASDAQ:HNRG) CEO Pay Cheque?

Brent Bilsland has been the CEO of Hallador Energy Company (NASDAQ:HNRG) since 2014. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we’ll consider growth that the business demonstrates. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

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How Does Brent Bilsland’s Compensation Compare With Similar Sized Companies?

Our data indicates that Hallador Energy Company is worth US$164m, and total annual CEO compensation is US$4.4m. (This number is for the twelve months until 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$350k. We looked at a group of companies with market capitalizations from US$100m to US$400m, and the median CEO compensation was US$955k.

Thus we can conclude that Brent Bilsland receives more in total compensation than the median of a group of companies in the same market, and of similar size to Hallador Energy Company. However, this doesn’t necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

You can see, below, how CEO compensation at Hallador Energy has changed over time.

NASDAQCM:HNRG CEO Compensation January 29th 19
NASDAQCM:HNRG CEO Compensation January 29th 19

Is Hallador Energy Company Growing?

On average over the last three years, Hallador Energy Company has grown earnings per share (EPS) by 7.2% each year (using a line of best fit). The trailing twelve months of revenue was pretty much the same as the prior period.

I’m not particularly impressed by the revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise.

Shareholders might be interested in this free visualization of analyst forecasts. .

Has Hallador Energy Company Been A Good Investment?

Hallador Energy Company has generated a total shareholder return of 17% over three years, so most shareholders would be reasonably content. But they probably don’t want to see the CEO paid more than is normal for companies around the same size.

In Summary…

We compared the total CEO remuneration paid by Hallador Energy Company, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.

Over the last three years returns to investors have been uninspiring, and we would have liked to see stronger business growth. In conclusion we think the company should definitely focus on improving the business before awarding any large pay rises. So you may want to check if insiders are buying Hallador Energy shares with their own money (free access).

Or you could feast your eyes on this interactive graph depicting past earnings, cash flow and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.