How Much Did YRC Worldwide's (NASDAQ:YRCW) CEO Pocket Last Year?

This article will reflect on the compensation paid to Darren Hawkins who has served as CEO of YRC Worldwide Inc. (NASDAQ:YRCW) since 2018. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for YRC Worldwide

Comparing YRC Worldwide Inc.'s CEO Compensation With the industry

At the time of writing, our data shows that YRC Worldwide Inc. has a market capitalization of US$320m, and reported total annual CEO compensation of US$2.1m for the year to December 2019. That's a notable decrease of 52% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at US$750k.

On comparing similar companies from the same industry with market caps ranging from US$200m to US$800m, we found that the median CEO total compensation was US$744k. Accordingly, our analysis reveals that YRC Worldwide Inc. pays Darren Hawkins north of the industry median. What's more, Darren Hawkins holds US$5.7m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 21% of total compensation out of all the companies we analyzed, while other remuneration made up 79% of the pie. It's interesting to note that YRC Worldwide pays out a greater portion of remuneration through salary, compared to the industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

YRC Worldwide Inc.'s Growth

Over the last three years, YRC Worldwide Inc. has shrunk its earnings per share by 74% per year. It saw its revenue drop 9.1% over the last year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has YRC Worldwide Inc. Been A Good Investment?

Given the total shareholder loss of 54% over three years, many shareholders in YRC Worldwide Inc. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we touched on above, YRC Worldwide Inc. is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. This doesn't look good against shareholder returns, which have been negative for the past three years. What's equally worrying is that the company isn't growing by our analysis. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

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 YRC Worldwide that investors should look into moving forward.

Important note: YRC Worldwide is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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. 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.
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