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Is Church & Dwight Co., Inc.'s (NYSE:CHD) CEO Pay Justified?

Simply Wall St

Matt Farrell has been the CEO of Church & Dwight Co., Inc. (NYSE:CHD) since 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for Church & Dwight

How Does Matt Farrell's Compensation Compare With Similar Sized Companies?

Our data indicates that Church & Dwight Co., Inc. is worth US$18b, and total annual CEO compensation is US$7.3m. (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$1.0m. We looked at a group of companies with market capitalizations over US$8.0b and the median CEO total compensation was US$11m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.

Most shareholders would consider it a positive that Matt Farrell takes less in total compensation than the CEOs of most other large companies, leaving more for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.

The graphic below shows how CEO compensation at Church & Dwight has changed from year to year.

NYSE:CHD CEO Compensation, September 14th 2019

Is Church & Dwight Co., Inc. Growing?

On average over the last three years, Church & Dwight Co., Inc. has grown earnings per share (EPS) by 17% each year (using a line of best fit). Its revenue is up 5.0% over last year.

This demonstrates that the company has been improving recently. A good result. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. It could be important to check this free visual depiction of what analysts expect for the future.

Has Church & Dwight Co., Inc. Been A Good Investment?

Most shareholders would probably be pleased with Church & Dwight Co., Inc. for providing a total return of 61% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

It appears that Church & Dwight Co., Inc. remunerates its CEO below most large companies. Since the business is growing, many would argue this suggests the pay is modest. The strong history of shareholder returns might even have some thinking that Matt Farrell deserves a raise!

It's not often we see shareholders do so well, and yet the CEO is paid modestly. The cherry on top would be if company insiders are buying shares with their own money. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Church & Dwight (free visualization of insider trades).

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.