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What Can We Conclude About Hamilton Beach Brands Holding's (NYSE:HBB) CEO Pay?

Simply Wall St
·3 mins read

Greg Trepp has been the CEO of Hamilton Beach Brands Holding Company (NYSE:HBB) since 2017, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Hamilton Beach Brands Holding

Comparing Hamilton Beach Brands Holding Company's CEO Compensation With the industry

At the time of writing, our data shows that Hamilton Beach Brands Holding Company has a market capitalization of US$288m, and reported total annual CEO compensation of US$2.4m for the year to December 2019. Notably, that's a decrease of 13% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$742k.

On examining similar-sized companies in the industry with market capitalizations between US$100m and US$400m, we discovered that the median CEO total compensation of that group was US$1.7m. This suggests that Greg Trepp is paid more than the median for the industry. Furthermore, Greg Trepp directly owns US$1.7m worth of shares in the company.

Component

2019

2018

Proportion (2019)

Salary

US$742k

US$735k

31%

Other

US$1.7m

US$2.0m

69%

Total Compensation

US$2.4m

US$2.8m

100%

Talking in terms of the industry, salary represented approximately 25% of total compensation out of all the companies we analyzed, while other remuneration made up 75% of the pie. It's interesting to note that Hamilton Beach Brands Holding pays out a greater portion of remuneration through salary, compared to the industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

ceo-compensation
ceo-compensation

Hamilton Beach Brands Holding Company's Growth

Hamilton Beach Brands Holding Company has seen its earnings per share (EPS) increase by 13% a year over the past three years. It achieved revenue growth of 5.4% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Hamilton Beach Brands Holding Company Been A Good Investment?

Since shareholders would have lost about 42% over three years, some Hamilton Beach Brands Holding Company investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

As previously discussed, Greg is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. However, we must not forget that the EPS growth has been very strong, but we cannot say the same about the uninspiring shareholder returns (over the last three years). Although we don't think the CEO pay is too high, considering negative investor returns, it is more generous than modest.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 3 warning signs for Hamilton Beach Brands Holding that investors should look into moving forward.

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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.