Is Carter's, Inc.'s (NYSE:CRI) CEO Salary Justified?
Mike Casey became the CEO of Carter's, Inc. (NYSE:CRI) in 2008. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. 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.
View our latest analysis for Carter's
How Does Mike Casey's Compensation Compare With Similar Sized Companies?
Our data indicates that Carter's, Inc. is worth US$3.9b, and total annual CEO compensation is US$7.3m. (This number is for the twelve months until December 2018). While we always look at total compensation first, we note that the salary component is less, at US$1.0m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of US$2.0b to US$6.4b. The median total CEO compensation was US$5.1m.
It would therefore appear that Carter's, Inc. pays Mike Casey 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 get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Carter's, below.
Is Carter's, Inc. Growing?
On average over the last three years, Carter's, Inc. has grown earnings per share (EPS) by 9.8% each year (using a line of best fit). In the last year, its revenue is up 1.7%.
I'd prefer higher revenue growth, but it is good to see modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Shareholders might be interested in this free visualization of analyst forecasts.
Has Carter's, Inc. Been A Good Investment?
With a three year total loss of 9.9%, Carter's, Inc. would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
In Summary...
We compared the total CEO remuneration paid by Carter's, Inc., and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. Shareholders may want to check for free if Carter's insiders are buying or selling shares.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt.
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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.
