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Is Altra Industrial Motion Corp. (NASDAQ:AIMC) Overpaying Its CEO?

Simply Wall St

Carl Christenson became the CEO of Altra Industrial Motion Corp. (NASDAQ:AIMC) in 2009. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. 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.

See our latest analysis for Altra Industrial Motion

How Does Carl Christenson's Compensation Compare With Similar Sized Companies?

Our data indicates that Altra Industrial Motion Corp. is worth US$1.6b, and total annual CEO compensation is US$3.6m. (This number is for the twelve months until December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$825k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$1.0b to US$3.2b. The median total CEO compensation was US$4.1m.

So Carl Christenson receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

The graphic below shows how CEO compensation at Altra Industrial Motion has changed from year to year.

NasdaqGS:AIMC CEO Compensation, August 19th 2019

Is Altra Industrial Motion Corp. Growing?

Over the last three years Altra Industrial Motion Corp. has grown its earnings per share (EPS) by an average of 7.1% per year (using a line of best fit). In the last year, its revenue is up 80%.

I like the look of the strong year-on-year improvement in revenue. And in that context, the modest EPS improvement certainly isn't shabby. I'd stop short of saying the business performance is amazing, but there are enough positives to justify further research, or even adding the stock to your watch-list. Shareholders might be interested in this free visualization of analyst forecasts.

Has Altra Industrial Motion Corp. Been A Good Investment?

Given the total loss of 10.0% over three years, many shareholders in Altra Industrial Motion Corp. are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Carl Christenson is paid around the same as most CEOs of similar size companies.

The company cannot boast particularly strong per share growth. And it's hard to argue that the returns over the last three years have delighted. So it would take a bold person to suggest the pay is too modest. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Altra Industrial Motion.

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

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.

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. Thank you for reading.