In 2015 Dion Weisler was appointed CEO of HP Inc (NYSE:HPQ). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. After that, we will consider the growth in the business. 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.
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How Does Dion Weisler's Compensation Compare With Similar Sized Companies?
According to our data, HP Inc has a market capitalization of US$36b, and pays its CEO total annual compensation worth US$15m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at US$1.3m. We took a group of companies with market capitalizations over US$8.0b, and calculated the median CEO compensation to be US$11m.
It would therefore appear that HP Inc pays Dion Weisler more than the median CEO remuneration at large companies, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at HP has changed from year to year.
Is HP Inc Growing?
On average over the last three years, HP Inc has grown earnings per share (EPS) by 7.0% each year. In the last year, its revenue is up 13%.
I think the revenue growth is good. And the improvement in earnings per share is modest but respectable. So while we'd stop just short of calling this a top performer, but we think it is well worth watching.
It could be important to check this free visual depiction of what analysts expect for the future.
Has HP Inc Been A Good Investment?
Boasting a total shareholder return of 109% over three years, HP Inc has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary...
We examined the amount HP Inc pays its CEO, and compared it to the amount paid by other large companies. We found that it pays well over the median amount paid in the benchmark group.
Over the last three years returns to investors have been great, though we might have liked stronger business growth. As a result of the juicy return to investors, the CEO remuneration may well be quite reasonable. Whatever your view on compensation, you might want to check if insiders are buying or selling HP shares (free trial).
Or you might prefer examine intentlythis intuitive graph showing past earnings and revenue.
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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 editorial-team@simplywallst.com.
Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.