Garry Ridge has been the CEO of WD-40 Company (NASDAQ:WDFC) since 1997. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we’ll consider growth that the business demonstrates. 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 Garry Ridge’s Compensation Compare With Similar Sized Companies?
Our data indicates that WD-40 Company is worth US$2.3b, and total annual CEO compensation is US$2.4m. (This number is for the twelve months until 2018). That’s a modest increase of 3.3% on the prior year year. While we always look at total compensation first, we note that the salary component is less, at US$649k. We looked at a group of companies with market capitalizations from US$1.0b to US$3.2b, and the median CEO compensation was US$3.5m.
Most shareholders would consider it a positive that Garry Ridge takes less compensation than the CEOs of most similar size companies, leaving more for shareholders. While this is a good thing, you’ll need to understand the business better before you can form an opinion.
The graphic below shows how CEO compensation at WD-40 has changed from year to year.
Is WD-40 Company Growing?
WD-40 Company has increased its earnings per share (EPS) by an average of 11% a year, over the last three years It achieved revenue growth of 7.4% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably.
You might want to check this free visual report on analyst forecasts for future earnings.
Has WD-40 Company Been A Good Investment?
Most shareholders would probably be pleased with WD-40 Company for providing a total return of 78% over three years. So they may not be at all concerned if the CEO is paid more than is normal for companies around the same size.
It appears that WD-40 Company remunerates its CEO below most similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. The pleasing shareholder returns are the cherry on top; you might even consider that Garry Ridge deserves a raise!
It is relatively rare to see a modestly paid CEO when performance is so impressive. It would be even more positive if company insiders are buying shares. Shareholders may want to check for free if WD-40 insiders are buying or selling shares.
Or you might rather take a peek at this analytical visualization of historic cash flow, earnings 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 firstname.lastname@example.org.