Lloyd Hoffman became the CEO of Alpha Pro Tech, Ltd. (NYSEMKT:APT) in 2016. 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. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
How Does Lloyd Hoffman's Compensation Compare With Similar Sized Companies?
According to our data, Alpha Pro Tech, Ltd. has a market capitalization of US$46m, and paid its CEO total annual compensation worth US$1.0m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at US$632k. 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$515k.
It would therefore appear that Alpha Pro Tech, Ltd. pays Lloyd Hoffman 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.
You can see, below, how CEO compensation at Alpha Pro Tech has changed over time.
Is Alpha Pro Tech, Ltd. Growing?
On average over the last three years, Alpha Pro Tech, Ltd. has grown earnings per share (EPS) by 19% each year (using a line of best fit). In the last year, its revenue is up 2.4%.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. Although we don't have analyst forecasts shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Alpha Pro Tech, Ltd. Been A Good Investment?
Alpha Pro Tech, Ltd. has generated a total shareholder return of 13% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
We compared total CEO remuneration at Alpha Pro Tech, Ltd. with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
However, the earnings per share growth over three years is certainly impressive. Looking at the same time period, we think that the shareholder returns are respectable. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn't call the CEO pay problematic. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Alpha Pro Tech (free visualization of insider trades).
If you want to buy a stock that is better than Alpha Pro Tech, this free list of high return, low debt companies is a great place to look.
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