Tile Shop Holdings, Inc.'s (NASDAQ:TTSH) CEO Compensation Looks Acceptable To Us And Here's Why

Key Insights

• Tile Shop Holdings' Annual General Meeting to take place on 3rd of June
• CEO Cabby Lolmaugh's total compensation includes salary of US$424.4k
• Total compensation is 69% below industry average
• Tile Shop Holdings' total shareholder return over the past three years was 32% while its EPS was down 59% over the past three years

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Performance at Tile Shop Holdings, Inc. (NASDAQ:TTSH) has been rather uninspiring recently and shareholders may be wondering how CEO Cabby Lolmaugh plans to fix this. At the next AGM coming up on 3rd of June, they can influence managerial decision making through voting on resolutions, including executive remuneration. It has been shown that setting appropriate executive remuneration incentivises the management to act in the interests of shareholders. In our opinion, CEO compensation does not look excessive and we discuss why.

View our latest analysis for Tile Shop Holdings

Comparing Tile Shop Holdings, Inc.'s CEO Compensation With The Industry

Our data indicates that Tile Shop Holdings, Inc. has a market capitalization of US$260m, and total annual CEO compensation was reported as US$733k for the year to December 2024. That's a modest increase of 6.7% on the prior year. In particular, the salary of US$424.4k, makes up a fairly large portion of the total compensation being paid to the CEO.

On comparing similar companies from the American Specialty Retail industry with market caps ranging from US$100m to US$400m, we found that the median CEO total compensation was US$2.3m. In other words, Tile Shop Holdings pays its CEO lower than the industry median. Furthermore, Cabby Lolmaugh directly owns US$1.3m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 17% of total compensation out of all the companies we analyzed, while other remuneration made up 83% of the pie. It's interesting to note that Tile Shop Holdings pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Tile Shop Holdings, Inc.'s Growth Numbers

Over the last three years, Tile Shop Holdings, Inc. has shrunk its earnings per share by 59% per year. In the last year, its revenue is down 6.4%.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Tile Shop Holdings, Inc. Been A Good Investment?

With a total shareholder return of 32% over three years, Tile Shop Holdings, Inc. shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

Despite the positive returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about the stock keeping up its current momentum. These are are some concerns that shareholders may want to address the board when they revisit their investment thesis.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for Tile Shop Holdings that investors should look into moving forward.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.