Is Roadrunner Transportation Systems, Inc.'s (NYSE:RRTS) CEO Paid Enough Relative To Peers?

Curt Stoelting has been the CEO of Roadrunner Transportation Systems, Inc. (NYSE:RRTS) since 2017. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Roadrunner Transportation Systems

How Does Curt Stoelting's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Roadrunner Transportation Systems, Inc. has a market cap of US$91m, and reported total annual CEO compensation of US$16m for the year to December 2019. That's a notable increase of 1058% on last year. While we always look at total compensation first, we note that the salary component is less, at US$571k. We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We examined a group of similar sized companies, with market capitalizations of below US$200m. The median CEO total compensation in that group is US$614k.

Next, let's break down remuneration compositions to understand how the industry and company compare with each other. On a sector level, around 17% of total compensation represents salary and 83% is other remuneration. Roadrunner Transportation Systems has chosen to walk a down a path less trodden, opting to compensate its CEO with less of a traditional salary and more non-salary rewards over the last year.

It would therefore appear that Roadrunner Transportation Systems, Inc. pays Curt Stoelting more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance. The graphic below shows how CEO compensation at Roadrunner Transportation Systems has changed from year to year.

Is Roadrunner Transportation Systems, Inc. Growing?

Over the last three years Roadrunner Transportation Systems, Inc. has seen earnings per share (EPS) move in a positive direction by an average of 78% per year (using a line of best fit). In the last year, its revenue is down 17%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. It could be important to check this free visual depiction of what analysts expect for the future.

Has Roadrunner Transportation Systems, Inc. Been A Good Investment?

Given the total loss of 98% over three years, many shareholders in Roadrunner Transportation Systems, Inc. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared the total CEO remuneration paid by Roadrunner Transportation Systems, Inc., and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

However, the earnings per share growth over three years is certainly impressive. On the other hand returns to investors over the same period have probably disappointed many. So shareholders might not feel great about the fact that CEO pay increased on last year. One might thus conclude that it would be better if the company waited until growth is reflected in the share price, before increasing CEO compensation. Taking a breather from CEO compensation, we've spotted 5 warning signs for Roadrunner Transportation Systems (of which 1 shouldn't be ignored!) you should know about in order to have a holistic understanding of the stock.

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

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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.

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