In 2012 Bryan Shinn was appointed CEO of U.S. Silica Holdings, Inc. (NYSE:SLCA). First, this article will compare CEO compensation with compensation at similar sized companies. Then we’ll look at a snap shot of the business growth. And finally – as a second measure of performance – we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
How Does Bryan Shinn’s Compensation Compare With Similar Sized Companies?
Our data indicates that U.S. Silica Holdings, Inc. is worth US$1.1b, and total annual CEO compensation is US$4.7m. (This figure is for the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$669k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$400m to US$1.6b. The median total CEO compensation was US$2.2m.
It would therefore appear that U.S. Silica Holdings, Inc. pays Bryan Shinn more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration 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 U.S. Silica Holdings has changed over time.
Is U.S. Silica Holdings, Inc. Growing?
Over the last three years U.S. Silica Holdings, Inc. has grown its earnings per share (EPS) by an average of 36% per year (using a line of best fit). Its revenue is up 27% over last year.
This demonstrates that the company has been improving recently. A good result. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. It could be important to check this free visual depiction of what analysts expect for the future.
Has U.S. Silica Holdings, Inc. Been A Good Investment?
Since shareholders would have lost about 25% over three years, some U.S. Silica Holdings, Inc. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We compared the total CEO remuneration paid by U.S. Silica Holdings, Inc., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
However we must not forget that the EPS growth has been very strong over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling U.S. Silica Holdings (free visualization of insider trades).
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.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.