Ted Harris has been the CEO of Balchem Corporation (NASDAQ:BCPC) since 2015. 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. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Ted Harris’s Compensation Compare With Similar Sized Companies?
Our data indicates that Balchem Corporation is worth US$3.6b, and total annual CEO compensation was reported as US$3.3m for the year to December 2018. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at US$800k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. We looked at a group of companies with market capitalizations from US$2.0b to US$6.4b, and the median CEO total compensation was US$4.9m.
A first glance this seems like a real positive for shareholders, since Ted Harris is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you’ll need to understand the business better before you can form an opinion.
You can see a visual representation of the CEO compensation at Balchem, below.
Is Balchem Corporation Growing?
Over the last three years Balchem Corporation has grown its earnings per share (EPS) by an average of 12% per year (using a line of best fit). The trailing twelve months of revenue was pretty much the same as the prior period.
This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see modest revenue growth, suggesting the underlying business is healthy. It could be important to check this free visual depiction of what analysts expect for the future.
Has Balchem Corporation Been A Good Investment?
Most shareholders would probably be pleased with Balchem Corporation for providing a total return of 36% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
Balchem Corporation is currently paying its CEO below what is normal for companies of its size.
Many would consider this to indicate that the pay is modest since the business is growing. The pleasing shareholder returns are the cherry on top; you might even consider that Ted Harris deserves a raise! It is relatively rare to see a modestly paid CEO when performance is so impressive. The cherry on top would be if company insiders are buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling Balchem shares (free trial).
Important note: Balchem may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.