The CEO of Natural Health Trends Corp. (NASDAQ:NHTC) is Chris Sharng. 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. 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.
How Does Chris Sharng’s Compensation Compare With Similar Sized Companies?
Our data indicates that Natural Health Trends Corp. is worth US$144m, and total annual CEO compensation is US$1.7m. (This number is for the twelve months until December 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$1.0m. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$419k.
Thus we can conclude that Chris Sharng receives more in total compensation than the median of a group of companies in the same market, and of similar size to Natural Health Trends Corp.. However, this doesn’t necessarily mean the pay is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Natural Health Trends has changed over time.
Is Natural Health Trends Corp. Growing?
On average over the last three years, Natural Health Trends Corp. has shrunk earnings per share by 26% each year (measured with a line of best fit). In the last year, its revenue is down -2.9%.
Sadly for shareholders, earnings per share are actually down, over three years. And the fact that revenue is down year on year arguably paints an ugly picture. It’s hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Natural Health Trends Corp. Been A Good Investment?
Given the total loss of 48% over three years, many shareholders in Natural Health Trends Corp. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
We compared the total CEO remuneration paid by Natural Health Trends Corp., 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.Earnings per share have not grown in three years, and the revenue growth fails to impress us.
Arguably worse, investors are without a positive return for the last three years. In our opinion the CEO might be paid too generously! CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Natural Health Trends (free visualization of insider trades).
If you want to buy a stock that is better than Natural Health Trends, this free list of high return, low debt companies is a great place to look.
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